EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0800968
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.
Hume Doors & Timber Pty Ltd applied for a TCO in respect of certain plywood door skins on 17 January 2008.
Instrument
TCO No 0800968 was made on 25 March 2008. It declares that those certain plywood door skins 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 free.
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. 0800968 is taken to have come into force on 17 January 2008.
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. 0800968, enacted in 2008, amends the Customs Act 1901 by providing tariff concessions for certain plywood door skins, reducing their customs duty rate from 5% to free. This legislation was introduced to address the gap in the tariff schedule for specific imported goods that do not have local substitutes, thereby encouraging the importation of these goods and potentially benefiting Australian consumers and industries. The instrument was created under the authority of the Chief Executive Officer of Customs, who is mandated to review and approve applications for tariff concessions based on specific criteria, such as the absence of substitutable goods produced in Australia. The policy objective is to support industries that rely on imported materials, ensuring they have access to competitive pricing and a broader range of products.
The Customs Act 1901, enacted by the Australian Parliament, provides a framework for tariff concessions through Tariff Concession Orders (TCOs). The Tariff Concession Instrument No. 0800968 was made to respond to an application from Hume Doors & Timber Pty Ltd, and after satisfying the core criteria, the CEO issued the TCO on 25 March 2008, effective from the date of the application, 17 January 2008. The instrument ensures that the rights of importers are positively affected, allowing them to apply for duty refunds on goods imported since the effective date, without imposing any liabilities on other parties. The process included a publication in the Gazette inviting submissions, which in this case, did not receive any.
Scope and Application
The Customs Act 1901, specifically under Part XVA, outlines the process through which Tariff Concession Orders (TCOs) can be made by the Chief Executive Officer of Customs. These TCOs apply to goods for which an application has been successfully lodged, provided that the goods are not specified in section 269SJ of the Act as ineligible for such concessions. The application process requires the CEO to determine if the goods in question meet the core criteria outlined in section 269C, which hinges on whether substitutable goods were produced in Australia in the ordinary course of business on the date the application was lodged. If the criteria are met, the CEO issues a TCO, which sets a lower rate of customs duty for the specified goods. This legislative framework facilitates tariff reductions for specific goods, promoting trade efficiency and economic benefits for importers. The TCOs do not affect existing rights or impose liabilities for actions taken before their registration, ensuring that the application of these concessions is forward-looking and protective of stakeholders' interests.
Key Provisions
The Tariff Concession Instrument No. 0800968, made under the Customs Act 1901 (the Act), pertains to a Tariff Concession Order (TCO) that was applied for by Hume Doors & Timber Pty Ltd in respect of certain plywood door skins on 17 January 2008 (sections 269F, 269K). The CEO of Customs (the CEO) was satisfied that the application met the core criteria, which include the absence of substitutable goods produced in Australia in the ordinary course of business on the day the application was lodged (section 269C). Consequently, a written order was made on 25 March 2008, declaring that these specific plywood door skins are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, thereby applying a duty rate of free, instead of the general rate of 5% (section 269P(3)).
Under the Act, the CEO has several obligations when dealing with TCO applications. Once a TCO application is accepted as valid, the CEO must publish a notice in the Gazette, inviting submissions from any person who believes the TCO should not be made (section 269K(1)). In this case, no submissions were received in response to the published notice. Additionally, the CEO must ensure that the application meets the core criteria, such as the absence of substitutable goods produced in Australia, before making the TCO (section 269C). The CEO is also required to decide whether the application meets the core criteria and, if satisfied, must make a written TCO specifying the applicable duty rate (section 269P(3)).
There are no specific offences, penalties, or civil/criminal consequences outlined in the explanatory statement for breaching the provisions of the Tariff Concession Instrument No. 0800968. However, any breach of the Customs Act 1901 or the Customs Tariff Act 1995, which govern the making of TCOs, could potentially lead to penalties under the respective Acts. For example, under the Customs Act 1901, offences related to the importation of goods may incur penalties such as fines or imprisonment, as specified in the relevant sections of the Act. The explanatory statement does not provide specific details on penalties related to this particular TCO.