EXPLANATORY STATEMENT
Select Legislative Instrument 2013 No. 1
Issued by authority of the Minister for Home Affairs
Customs Act 1901
Customs Amendment Regulation 2013 (No. 1)
Section 270 of the Customs Act 1901 provides that the Governor-General may make regulations prescribing matters required or permitted by the Act to be prescribed, or as necessary or convenient to be prescribed for carrying out or giving effect to the Act.
Customs Amendment Regulation 2013 (No. 1) (the Regulation) amends the Customs Regulations 1926 to make a minor change to the sealed bag scheme (SBS).
The SBS allows international travellers to purchase goods, tax free (excise or customs duty, GST or Wine Equalisation Tax) from duty free stores and certain retail stores. Goods purchased through the SBS are placed in a sealed bag which remains sealed to ensure that the traveller takes the goods out of the country so that the goods cannot be consumed in Australia, and therefore are not subject to Australian taxes.
The Regulation extends the period during which travellers can acquire goods free of customs duty through the SBS from 30 days to 60 days prior to departure.
Consultation was undertaken on the change and no changes were made as a result of consultation.
The Regulation applies to acquisitions made 60 days or more after the day the Regulation is registered on the Federal Register of Legislative Instruments.
The Regulation commences on the day after it is registered.
The Regulation is a legislative instrument for the purposes of the Legislative Instruments Act 2003.
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Customs Amendment Regulation 2013 (No. 1)
This Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Legislative Instrument
The purpose of the Legislative Instrument is to extend the period for which international travellers can make purchases free of customs duty through the sealed bag scheme (SBS) from 30 days to 60 days.
Human rights implications
This Legislative Instrument does not engage any of the applicable rights or freedoms. It increases the flexibility of international travellers to access the SBS.
Conclusion
This Legislative Instrument is compatible with human rights as it does not raise any human rights issues.
Overview
The Customs Amendment Regulation 2013 (No. 1) was enacted to amend the Customs Regulations 1926, specifically to extend the period for which international travellers can make purchases free of customs duty through the sealed bag scheme (SBS). The Customs Act 1901, administered by the Australian Government, provides the authority for the creation of these regulations. This minor change was introduced to offer more flexibility to international travellers by extending the SBS period from 30 days to 60 days prior to departure. The Regulation was issued by the Minister for Home Affairs and it was registered on the Federal Register of Legislative Instruments, becoming effective the day after registration. The amendment was developed following consultation, though no changes were made in response to the feedback. The Regulation does not engage any of the applicable rights or freedoms and is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Scope and Application
The Customs Amendment Regulation 2013 (No. 1) amends the Customs Regulations 1926, extending the period during which international travellers can acquire goods free of customs duty through the sealed bag scheme (SBS) from 30 days to 60 days prior to their departure from Australia. This change is aimed at providing greater flexibility to travellers who wish to benefit from the SBS, which allows them to purchase goods tax-free from duty-free stores and certain retail stores, provided the goods remain in a sealed bag until they leave the country. The Regulation applies to acquisitions made 60 days or more after the Regulation is registered on the Federal Register of Legislative Instruments and commenced on the day following its registration. This amendment does not alter the fundamental requirements of the SBS and does not introduce any new exclusions or exemptions; it merely extends the timeframe within which travellers can participate in the scheme. The Regulation is a legislative instrument for the purposes of the Legislative Instruments Act 2003 and has been deemed compatible with human rights under the Human Rights (Parliamentary Scrutiny) Act 2011, as it does not engage any applicable rights or freedoms.
Key Provisions
The Customs Amendment Regulation 2013 (No. 1) amends the Customs Regulations 1926, primarily to adjust the timeframe under which international travellers can purchase goods tax-free through the sealed bag scheme (SBS) (reg. 3). Previously, travellers could acquire goods free of excise, customs duty, GST, or Wine Equalisation Tax up to 30 days before their departure. The Regulation extends this period to 60 days, providing more flexibility for travellers to shop tax-free goods before leaving Australia (reg. 3). This adjustment is intended to benefit travellers by allowing them more time to make purchases in duty-free and certain retail stores, ensuring the goods are sealed and exported, thus avoiding Australian taxes.
The Regulation imposes certain obligations on travellers participating in the SBS. Travellers must ensure that the goods purchased are placed in a sealed bag and remain sealed until they are removed from Australia (reg. 3). The sealed bag must be presented to Australian Customs upon departure to verify compliance with the SBS requirements. The Regulation also requires retailers to adhere to the new timeframe and ensure the proper sealing of goods for travellers participating in the SBS. These obligations are crucial to maintain the integrity of the scheme and prevent the consumption of duty-free goods within Australia, which would otherwise incur taxes.
Breaches of the SBS requirements, such as failing to present a sealed bag or consuming goods within Australia, may result in penalties. Under the Customs Act 1901, penalties for non-compliance can include fines and potential criminal charges (s. 276). The maximum penalties for contravening customs laws can extend to significant financial penalties and imprisonment, depending on the severity of the breach. For example, a person who fails to declare dutiable goods or provides false information may face fines of up to $11,000 and/or imprisonment for up to two years (s. 277). These consequences underscore the importance of adhering to the SBS regulations to avoid legal repercussions.