EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0711819
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.
Major Projects Victoria applied for a TCO in respect of certain x-ray beamline parts on 23 July 2007.
Instrument
TCO No 0711819 was made on 12 October 2007. It declares that those certain x-ray beamline parts 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. 0711819 is taken to have come into force on 23 July 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 was enacted by the Australian Parliament and serves to regulate the import and export of goods across Australia's borders. The Act allows for the creation of Tariff Concession Orders (TCOs) which provide a lower rate of customs duty on certain goods. The introduction of TCOs aims to address the gap in providing economic benefits to industries by reducing the cost of importing specific goods that are not produced domestically, thereby fostering growth and competitiveness. The process for applying for a TCO is outlined in Part XVA of the Act, where the Chief Executive Officer of Customs is responsible for assessing applications and determining whether they meet the core criteria, which include the absence of substitutable goods produced in Australia. In line with the policy objective of the Customs Act, TCO No. 0711819 was introduced to provide a zero per cent duty rate on certain x-ray beamline parts, benefitting importers and promoting the advancement of scientific projects in Victoria.
Scope and Application
The Customs Act 1901 provides a framework for the Chief Executive Officer of Customs (CEO) to issue Tariff Concession Orders (TCOs) that lower the rate of customs duty on specified goods. This legislative mechanism applies to any person or entity that wishes to import goods and can benefit from a concession on customs duty. The CEO can only issue a TCO if no substitutable goods are produced in Australia and the application meets the criteria outlined in the Act. For instance, Major Projects Victoria successfully applied for a TCO for certain x-ray beamline parts, resulting in a duty reduction from 5% to 0%. The CEO must publish a notice in the Gazette inviting objections to the TCO, although no submissions were received in this instance. Once an application is lodged, the TCO is deemed to have come into effect on that date, providing prospective benefits to importers who can apply for duty refunds on goods imported since the effective date. The TCO does not disadvantage any person or impose new liabilities on them. The scope of this legislation is national, applying across all states and territories within Australia.
Key Provisions
The Customs Act 1901 (section 269F) enables individuals or entities to apply to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) for specific goods. If the application is deemed valid, the CEO evaluates whether it meets the core criteria as outlined in section 269C. If satisfied, the CEO issues a TCO which applies a lower customs duty rate to the specified goods. In the context of TCO No. 0711819, certain x-ray beamline parts are subject to this concession, with the general duty rate reduced from 5% to 0%.
The Act imposes obligations on both the CEO and applicants for a TCO. For the CEO, this includes assessing applications to determine if they meet the core criteria and making a decision within the stipulated timeframe. The CEO is also required to publish a notice in the Gazette (subsection 269K(1)) inviting public submissions on the application. This transparency ensures that interested parties have an opportunity to voice any objections. On the other hand, applicants must ensure their submissions are complete and address all criteria as set out in the Act.
Non-compliance with the provisions of the Customs Act 1901 can lead to various legal consequences. For instance, if a person knowingly imports goods without the required TCO, they may face penalties. Although the explanatory statement does not detail specific penalties for non-compliance, it is understood that breaches of customs regulations can lead to fines and potential criminal charges, depending on the severity and intent behind the breach. The exact penalties would be determined by relevant sections of the Customs Act and associated regulations.