EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0839003
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.
The Reject Shop Pty Ltd applied for a TCO in respect of certain waste paper baskets on 10 November 2008.
Instrument
TCO No 0839003 was made on 23 January 2009. It declares that those certain waste paper baskets 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. 0839003 is taken to have come into force on 10 November 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. 0839003 was enacted in 2009 under the Customs Act 1901, aiming to provide a concession on customs duty for certain waste paper baskets imported into Australia. The Act, enacted by the Australian Parliament, establishes a framework for Tariff Concession Orders (TCOs) that can be applied for by individuals to reduce or eliminate customs duties on specific goods. The policy objective of this legislation is to ensure that Australian consumers benefit from lower prices for goods that cannot be produced domestically, thereby promoting economic efficiency and consumer welfare. The instrument was introduced to address the gap where certain imported goods, such as waste paper baskets, could potentially benefit from reduced tariffs if no substitutable goods are produced in Australia. The Chief Executive Officer of Customs is responsible for deciding on TCO applications based on the criteria outlined in the Act.
Scope and Application
The Tariff Concession Instrument No. 0839003 applies to the importation of certain waste paper baskets, granting them a lower rate of customs duty under the Customs Act 1901. This Act applies to the importation of goods into Australia and provides for the imposition of customs duty on those goods. The instrument was made by the Chief Executive Officer of Customs following an application from The Reject Shop Pty Ltd on 10 November 2008, and it came into effect on that date. The Act applies to individuals and entities involved in the importation of goods into Australia, and the instrument specifically addresses the importation of waste paper baskets, which are subject to a tariff concession, reducing the duty from the general rate of 5% to free. The instrument does not apply to goods specified in section 269SJ of the Act, which cannot be subject to a TCO. The instrument does not affect the rights of any person as at the date of registration and does not impose any liabilities on any person. The instrument’s scope can be extended or restricted through subordinate instruments, as authorised by the Customs Act 1901.
Key Provisions
The Tariff Concession Instrument No. 0839003 made under the Customs Act 1901 (the Act) provides a concession on customs duty for certain waste paper baskets. Section 269F of the Act allows an application to be made to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) if the goods in question meet the specified criteria. Pursuant to section 269C, the CEO must assess whether the application meets the core criteria, which include ensuring that no substitutable goods are produced in Australia in the ordinary course of business on the date the application was lodged. If the CEO is satisfied that the application meets these criteria, they are required under section 269P(3) to issue a written TCO. This instrument, TCO No. 0839003, was issued on 23 January 2009, declaring that the waste paper baskets in question are subject to item 50 of Schedule 4 to the Customs Tariff Act 1995, resulting in a duty rate of free instead of the general rate of 5%.
The obligations under the Act for parties applying for a TCO include ensuring that the application is not for goods specified in section 269SJ of the Act, which lists those goods that cannot be subject to a TCO. Additionally, the CEO is required under subsection 269K(1) to publish a notice in the Gazette inviting submissions from any person who believes there are reasons why the TCO should not be made. This procedural step ensures transparency and provides an opportunity for interested parties to voice their concerns. In this instance, no submissions were received in response to the published notice.
The Act does not impose specific penalties for breaches of its provisions concerning TCOs, but non-compliance with the requirements to apply for a TCO or the CEO’s decision to issue one could potentially lead to disputes over duty rates and refunds. The rights of importers are positively affected under paragraph 126(1)(r) of the Regulations, allowing them to apply for a refund of duty on goods imported since the effective date of the TCO. This TCO does not disadvantage any person or impose new liabilities, ensuring that it only benefits those who import the specified waste paper baskets from the date it came into force, which is the date the application was lodged, 10 November 2008.