EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0513554
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.
CSR Building Products Ltd applied for a TCO in respect of certain Kiln Tunnel on 6 October 2005.
Instrument
TCO No 0513554 was made on 3 January 2006. It declares that those certain Kiln Tunnel 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. 0513554 is taken to have come into force on 6 October 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. 0513554 was enacted in 2006 under the Customs Act 1901 to address the need for tariff concessions on specific goods imported into Australia. This legislation was introduced to facilitate the application of lower customs duties on goods that do not have substitutable alternatives produced domestically, thereby supporting importers by reducing their duty costs. The instrument was enacted by the Chief Executive Officer of Customs in accordance with the provisions of the Customs Act, which allows for the application of tariff concessions when certain conditions are met, such as the absence of substitutable goods produced in Australia. The policy objective is to ensure that importers of goods not produced domestically are not unfairly burdened by customs duties, thereby promoting fair trade practices and economic efficiency.
Scope and Application
The Tariff Concession Instrument No. 0513554 is a specific legislative measure that applies to the importation of certain Kiln Tunnel, aligning with Part XVA of the Customs Act 1901. This legislation is designed to provide tariff concessions to importers of specified goods, effectively reducing or eliminating customs duty on these goods. The Act applies to any person or entity seeking a tariff concession for particular goods, contingent upon the absence of substitutable goods produced in Australia at the time of the application. The geographic reach of this legislation is national, as it pertains to the application and administration of customs duties across Australia. It is noteworthy that the Act excludes certain goods from being subject to a tariff concession, as outlined in section 269SJ of the Customs Act 1901. The instrument is subject to the broader regulatory framework established by the Customs Tariff Act 1995, with any further specification or restriction on its application being addressed through subordinate instruments, such as regulations or orders, as may be necessary under the overarching Acts.
Key Provisions
The Customs Act 1901, as amended by Tariff Concession Instrument No. 0513554, allows for the application of lower rates of customs duty to specific goods through Tariff Concession Orders (TCOs). According to section 269F, any person may apply to the Chief Executive Officer (CEO) of Customs for a TCO in respect of certain goods. If the application is not for goods listed in section 269SJ, which cannot be subject to a TCO, the CEO must then determine if the application meets the core criteria specified in section 269C. This involves verifying that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. Definitions for terms such as 'goods produced in Australia', 'ordinary course of business', and'substitutable goods' are provided in sections 269D, 269E, and 269P(3) respectively.
Under section 269P(3), if the CEO is satisfied that the TCO application meets the core criteria, a written order is made declaring that the goods in question are subject to a prescribed item of Schedule 4 to the Customs Tariff Act 1995. This instrument, TCO No. 0513554, was made on 3 January 2006 and specifies that certain Kiln Tunnel are subject to item 50 of Schedule 4, resulting in a duty rate of 0% instead of the general rate of 5%. The TCO came into effect on 6 October 2005, the date the application was lodged, as per subsection 269S(1). The TCO does not affect any existing rights or liabilities of persons other than the Commonwealth and does not impose any new liabilities on any person.
The CEO is obligated to publish a notice in the Gazette as soon as practicable after accepting a TCO application as valid, inviting any person who believes there are reasons why the TCO should not be made to lodge a submission. In this case, the CEO did not receive any submissions in response to the published notice. This process ensures transparency and provides an opportunity for interested parties to voice their concerns. The TCO benefits importers by allowing them to apply for a refund of duty on goods imported since the TCO came into effect, under paragraph 126(1)(r) of the Regulations.
Failure to comply with the requirements of the Customs Act 1901 and the associated regulations can lead to various civil and criminal consequences. For instance, importing goods without the appropriate duty paid, or falsely claiming a tariff concession, can result in penalties. The specific penalties are not detailed in the provided text but typically include fines and, in more severe cases, imprisonment. The exact penalties would be determined based on the nature and severity of the breach, as outlined in the relevant sections of the Customs Act 1901.