EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0508784
Customs Act 1901
Background
Part XVA of the Customs Act 1901 (the Act) sets out a scheme under which Tariff Concession Orders (TCOs) may be made by the Chief Executive Officer of Customs (the CEO). A lower rate of customs duty applies to goods that are the subject of a TCO.
Under section 269F of the Act, a person may apply to the CEO for a TCO in respect of goods. If the CEO is satisfied that the application is not in respect of goods specified in section 269SJ of the Act, which sets out those goods that cannot be subject to a TCO, the CEO must decide whether the application meets the core criteria.
Section 269C of the Act provides that a TCO application meets the core criteria if, on the day on which the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Section 269B of the Act provides that ‘goods produced in Australia’ has the meaning given by section 269D, ‘ordinary course of business’ has the meaning given by section 269E and ‘substitutable goods’ in respect of goods the subject of a TCO application, means goods produced in Australia that are put, or are capable of being put, to a use that corresponds with a use (including a design use) to which the goods the subject of the application can be put.
Subsection 269P(3) of the Act provides that if the CEO is satisfied that a TCO application meets the core criteria, the CEO must make a written order (a TCO) declaring that the goods the subject of the TCO application are goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 (the Tariff) specified in the order applies.
J L Lennard applied for a TCO in respect of certain Meal Delivery Trolleys on 6 July 2005.
Instrument
TCO No 0508784 was made on 30 September 2005. It declares that those certain Meal Delivery Trolleys are goods to which item 50 of Schedule 4 to the Tariff applies since the CEO was satisfied that no substitutable goods were produced in Australia. The general rate of duty on these goods is 5%. The rate of duty for the goods subject to the TCO is 0%.
Consultation
Subsection 269K(1) of the Act provides in part that as soon as practicable after accepting a TCO application as a valid application, the CEO must publish a notice in the Gazette which includes an invitation to any person who considers that there are reasons why the TCO should not be made to lodge a submission with the CEO. The CEO did not receive any submissions in response to this invitation.
Commencement
Subsection 269S(1) relevantly provides that a TCO is to be taken to have come into force on the day on which the application for the TCO was lodged. TCO No. 0508784 is taken to have come into force on 6 July 2005.
The TCO does not affect the rights of a person (other than the Commonwealth) as at the date of registration so as to disadvantage that person or impose liabilities on a person (other than the Commonwealth) in respect of anything done or omitted to be done before the date of registration. The rights of importers will be beneficially affected. Under paragraph 126(1)(r) of the Regulations, importers of such goods will be able to apply for a refund of duty on goods imported since the day on which the TCO is taken to have come into force. The TCO does not impose any liabilities on any person.
Overview
The Tariff Concession Instrument No. 0508784, enacted in 2005, is an instrument under the Customs Act 1901 designed to address the need for tariff concessions on specific imported goods. The Customs Act 1901 provides a framework for the Chief Executive Officer of Customs to grant Tariff Concession Orders (TCOs) that reduce the customs duty payable on certain goods, provided no substitutable goods are produced in Australia. This legislative instrument was introduced to provide a mechanism for reducing the customs duty on goods that are not domestically produced, thereby making these goods more affordable and accessible. The instrument was enacted by the Australian Parliament and aims to facilitate trade by lowering the cost of imported goods, which in turn supports economic activity and consumer choice. The instrument became effective on the date the application was lodged, 6 July 2005, and does not disadvantage any party other than the Commonwealth or impose any new liabilities on individuals or entities.
Scope and Application
The Tariff Concession Instrument No. 0508784 under the Customs Act 1901 applies to individuals and entities that seek a reduction in the customs duty rate on specific imported goods. This particular instrument pertains to Meal Delivery Trolleys and was made in response to an application submitted by J L Lennard on 6 July 2005. The instrument was issued by the Chief Executive Officer of Customs on 30 September 2005, following satisfaction that no substitutable goods were produced in Australia. The instrument modifies the rate of duty for these trolleys from the general 5% rate to 0%, effective from the date the application was lodged, 6 July 2005. The application of the instrument is limited to the goods specified in the instrument and does not extend to other types of goods unless a separate application is made and approved. The instrument applies across the Commonwealth of Australia, impacting importers who may benefit from the reduced duty rate, without imposing any new liabilities on any person. The rights of importers will be positively affected, as they may apply for a refund of duty on the imported goods from the date the concession order came into effect.
Key Provisions
The primary sections of Tariff Concession Instrument No. 0508784 (section 269C, section 269B, section 269E, and section 269P(3)) require that a Tariff Concession Order (TCO) be considered by the Chief Executive Officer of Customs (CEO) if an application is submitted, and if it is found that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. If the CEO is satisfied that the application meets the core criteria, they must make a written order (a TCO) that specifies the goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies. In this case, Instrument TCO No. 0508784 was made on 30 September 2005, declaring that certain Meal Delivery Trolleys are goods to which item 50 of Schedule 4 to the Tariff applies, resulting in a duty rate of 0% for these goods.
The Act imposes several obligations on the CEO in relation to TCOs. For example, under section 269K(1), the CEO must publish a notice in the Gazette as soon as practicable after accepting a TCO application as a valid application. This notice must include an invitation for any person who believes the TCO should not be made to lodge a submission with the CEO. In this instance, the CEO did not receive any submissions in response to the invitation. Additionally, section 269S(1) states that a TCO is to be taken to have come into force on the day on which the application for the TCO was lodged, which was 6 July 2005 for Instrument TCO No. 0508784. Furthermore, the TCO does not affect the rights of a person (other than the Commonwealth) as at the date of registration so as to disadvantage that person or impose liabilities on a person (other than the Commonwealth) in respect of anything done or omitted to be done before the date of registration.
Failure to comply with the requirements of the Customs Act 1901 can result in various civil and criminal consequences. For instance, under section 156 of the Customs Act, any person who makes a false or misleading statement in an application for a TCO can be subject to penalties. The maximum penalty for such an offence can be up to 10,000 penalty units or imprisonment for five years, or both, as stipulated in section 156. The Act also includes provisions for the imposition of pecuniary penalties for breaches of the Customs Act, which can be enforced by the Australian Taxation Office (ATO) or in a court. The CEO has the authority to investigate and take action against any person who is found to be in breach of the Act or its regulations.