EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0805149
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.
Ozfleck Industries Pty Ltd applied for a TCO in respect of certain asphalt recycling machine on 2 April 2008.
Instrument
TCO No 0805149 was made on 20 June 2008. It declares that those certain asphalt recycling machines 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. 0805149 is taken to have come into force on 2 April 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. 0805149, made under the Customs Act 1901, was enacted to provide tariff concessions on certain asphalt recycling machines. This instrument was introduced to address the gap in the existing tariff structure by providing relief on customs duties for specific goods that are not produced domestically, thereby encouraging the importation of these goods for use in Australia. The instrument was made by the Chief Executive Officer of Customs and aims to benefit importers by allowing them to apply for refunds of duty on these goods imported since the date the instrument came into effect. The instrument does not affect any pre-existing rights or impose liabilities on individuals other than the Commonwealth, ensuring that the rights of importers are positively impacted without causing any disadvantage or additional burden.
Scope and Application
The Customs Act 1901, as supplemented by Tariff Concession Instrument No. 0805149, provides a framework for the reduction of customs duties on specific goods through the issuance of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO). This particular Instrument, made on 20 June 2008, pertains to certain asphalt recycling machines applied for by Ozfleck Industries Pty Ltd on 2 April 2008. The Instrument declares that these machines are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, with a reduced duty rate from the general 5% to free, effective from the date the application was lodged, 2 April 2008. The CEO was satisfied that no substitutable goods were produced in Australia, thereby meeting the core criteria set out in the Customs Act. This Instrument applies to the specific goods identified in the application and does not affect the rights of any person as at the date of registration, nor does it impose any liabilities on any person. Importers of these goods can benefit by applying for a refund of duty on goods imported since the effective date of the TCO.
Key Provisions
The primary operative sections of this legislation include sections 269C, 269B, and 269P of the Customs Act 1901. Section 269C specifies that a Tariff Concession Order (TCO) application meets the core criteria if, on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Section 269B clarifies the meanings of terms such as 'goods produced in Australia', 'ordinary course of business', and'substitutable goods'. Finally, section 269P(3) mandates that if the Chief Executive Officer (CEO) of Customs is satisfied that a TCO application meets the core criteria, the CEO must make a written order declaring the goods to which the prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies.
The Act imposes specific obligations and requirements on the parties involved, particularly on the CEO of Customs. Once a TCO application is accepted as valid, the CEO must publish a notice in the Gazette, inviting any person who believes there are reasons why the TCO should not be made to lodge a submission. If no submissions are received, the CEO must then decide whether to issue a TCO. In this case, TCO No. 0805149 was made on 20 June 2008, declaring that certain asphalt recycling machines are subject to a reduced duty rate of free, down from the general rate of 5%.
There are no explicit offences, penalties, or civil/criminal consequences outlined in the explanatory statement for failing to comply with the provisions of the Act or for breaching the terms of a TCO. However, the Act ensures that the TCO does not affect the rights of a person as at the date of registration to their disadvantage or impose any new liabilities. Importers, however, can benefit from the rights conferred by the TCO, such as applying for a refund of duty on goods imported since the TCO came into force.