EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0617248
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.
Inghams Enterprises Pty Ltd applied for a TCO in respect of certain transport trailers on 15 September 2006.
Instrument
TCO No 0617248 was made on 8 December 2006. It declares that those certain transport trailers 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. 0617248 is taken to have come into force on 15 September 2006.
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 Customs Act 1901 was enacted to facilitate trade and manage customs duties among other things. The Tariff Concession Instrument No. 0617248, introduced in 2006, addresses the problem of ensuring that Australian businesses can access necessary goods at competitive rates, particularly where no local substitutes exist. This instrument was introduced by the Chief Executive Officer of Customs under section 269F of the Customs Act 1901, following an application from Inghams Enterprises Pty Ltd for tariff concessions on certain transport trailers. The policy objective behind this concession is to support Australian businesses by reducing the cost of importing specific goods, thereby promoting economic efficiency and competitiveness in the marketplace. The instrument was designed to provide tariff relief where no substitutable goods were produced in Australia, ensuring that businesses can continue to operate effectively without undue financial burden.
Scope and Application
The Tariff Concession Instrument No. 0617248 under the Customs Act 1901 applies specifically to the goods for which Inghams Enterprises Pty Ltd applied for a Tariff Concession Order (TCO) on 15 September 2006. This legislation pertains to certain transport trailers, which now benefit from a reduced rate of customs duty as specified in item 50 of Schedule 4 to the Customs Tariff Act 1995, with the duty rate being reduced from the general rate of 5% to 0%. The application process and decision-making authority are vested in the Chief Executive Officer of Customs (CEO), who must ascertain that no substitutable goods are produced in Australia and that the application meets the core criteria outlined in the Act. The geographic reach of this legislation is national, applying across Australia, and it comes into force on the date the application was lodged, 15 September 2006. The legislation does not disadvantage any existing rights of persons other than the Commonwealth and imposes no new liabilities, while allowing for potential duty refunds for importers of the specified goods.
Key Provisions
The Tariff Concession Instrument No. 0617248, issued under section 269F of the Customs Act 1901, outlines the process for applying and granting tariff concession orders (TCOs) for specific goods. Section 269F allows individuals or entities to apply to the Chief Executive Officer of Customs (CEO) for a TCO, which permits a lower rate of customs duty on the goods in question. For the CEO to grant a TCO, the application must meet the core criteria set out in sections 269B, 269C, 269D, 269E, and 269P(3) of the Act. Specifically, the application can only succeed if the goods are not specified in section 269SJ and if, on the day the application was made, no substitutable goods were produced in Australia in the ordinary course of business. In the case of Inghams Enterprises Pty Ltd’s application for certain transport trailers, the CEO found that no substitutable goods were produced in Australia, leading to the issuance of TCO No. 0617248, which declares that these trailers are subject to a 0% duty rate, down from the general rate of 5%.
The Customs Act 1901 imposes several obligations on both the CEO and applicants for TCOs. Section 269K(1) mandates that the CEO must publish a notice in the Gazette once an application is accepted as valid, inviting any interested parties to submit objections. In this instance, the CEO did not receive any submissions. Section 269S(1) dictates that a TCO comes into effect on the date the application is lodged, which for TCO No. 0617248 was 15 September 2006. Importantly, the Act ensures that the TCO does not disadvantage any person other than the Commonwealth or impose liabilities for actions taken before the TCO's effective date.
Failure to comply with the provisions of the Customs Act 1901 regarding TCOs can result in civil and criminal penalties. While the Explanatory Statement does not detail specific penalties for non-compliance, general provisions under the Customs Act outline various offences and associated penalties. These can include fines and imprisonment for more serious breaches. The precise penalties would depend on the nature and severity of the breach, as defined under the broader legislative framework governing customs and tariff regulations.