EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0707037
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.
R H Bare Pty Ltd applied for a TCO in respect of certain truck or bus or tractor seats on 11 May 2007.
Instrument
TCO No 0707037 was made on 20 July 2007. It declares that those certain truck or bus or tractor seats 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 10%. 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. 0707037 is taken to have come into force on 11 May 2007.
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, enacted by the Australian Parliament, provides a framework for the regulation of customs and excise duties, including the ability to grant tariff concessions. This legislation was introduced to address the need for flexible tariff arrangements that can support economic growth by facilitating the importation of goods that are not produced domestically or are produced in limited quantities. Tariff Concession Orders (TCOs), which are made by the Chief Executive Officer of Customs under section 269F of the Act, enable the application of lower customs duty rates on specified goods. The objective is to ensure that the importation of these goods does not disadvantage domestic producers of substitutable goods while allowing for a more competitive market. Tariff Concession Instrument No. 0707037, made on 20 July 2007, is an example of such a concession, reducing the duty on certain truck or bus or tractor seats from 10% to 0% as no substitutable goods were produced in Australia at the time of the application. This instrument came into force on 11 May 2007, the date the application was lodged, and it does not impose any liabilities on individuals or entities other than the Commonwealth.
Scope and Application
The Tariff Concession Instrument No. 0707037, made under the Customs Act 1901, pertains to a specific category of goods, namely truck or bus or tractor seats, and grants tariff concessions to these goods by reducing their customs duty from the general rate of 10% to 0%. This Act applies to any individual or entity involved in the import of these specified goods within Australia, and its scope encompasses the process of tariff concession applications and approvals. The authority to grant these concessions lies with the Chief Executive Officer of Customs, who must ensure that the application meets certain criteria, notably that no substitutable goods are produced in Australia. This legislative instrument extends across the entire Commonwealth of Australia, impacting all importers of the designated goods.
The application process and the terms of the concessions are detailed within the Customs Act 1901, which mandates that applications must be lodged in accordance with the specified legislative framework. The instrument takes effect from the date the application was lodged, in this case, 11 May 2007. Importantly, the Tariff Concession Order does not retroactively affect any rights or liabilities of individuals or entities other than the Commonwealth, ensuring that no pre-existing transactions are disadvantaged. The Act does not explicitly exclude any categories of goods or applicants, but it does provide that certain goods, as specified in section 269SJ, cannot be the subject of a tariff concession order. This instrument does not establish any subordinate legislation to further define its application, relying instead on the provisions of the primary Act.
Key Provisions
The Customs Act 1901 (the Act) provides a framework for the implementation of Tariff Concession Orders (TCOs) as outlined in Part XVA. When an application for a TCO is submitted under section 269F, the Chief Executive Officer of Customs (the CEO) assesses whether the application meets the core criteria specified in sections 269C, 269B, 269D, and 269E. If satisfied that no substitutable goods were produced in Australia in the ordinary course of business, the CEO must issue a written order declaring the specified goods subject to the lower customs duty rate as per Schedule 4 of the Customs Tariff Act 1995 (the Tariff). In the case of TCO No. 0707037, the CEO determined that certain truck, bus, or tractor seats qualified for a concession, resulting in a duty rate of 0% instead of the general rate of 10%.
The Act imposes specific obligations on the CEO when processing TCO applications. Under section 269K(1), the CEO must publish a notice in the Gazette after accepting a TCO application, inviting any interested parties to submit submissions if they believe the TCO should not proceed. This ensures transparency and allows for stakeholder input. In the instance of TCO No. 0707037, no submissions were received, indicating no objections to the concession. The TCO's commencement date, as per subsection 269S(1), is the date the application was lodged, meaning TCO No. 0707037 took effect on 11 May 2007.
The legislation also outlines the implications of TCOs for parties involved. The TCO does not disadvantage or impose liabilities on any person (other than the Commonwealth) for actions taken before the registration date. However, it benefits importers by allowing them to apply for duty refunds on goods imported since the TCO's effective date, as per paragraph 126(1)(r) of the Regulations. This means that importers of the specified seats can seek refunds for duties paid on imports since 11 May 2007.
Regarding breaches of the Act, specific offences and penalties are not detailed in the provided text. However, non-compliance with the Act's provisions or misuse of TCOs could potentially lead to civil or criminal consequences, though the exact penalties would depend on the nature of the breach and applicable laws. It is important for applicants and beneficiaries to adhere to the legal requirements to avoid any legal repercussions.