EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0904149
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.
John Wagstaff Constructions applied for a TCO in respect of certain mixer and grader soil cutter on 06 February 2009.
Instrument
TCO No 0904149 was made on 01 May 2009. It declares that those certain mixer and grader soil cutter 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. 0904149 is taken to have come into force on 06 February 2009.
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. 0904149, enacted in 2009, amends the Customs Act 1901 to address a specific gap in tariff concession orders for certain goods. This instrument was introduced to provide tariff concessions for specific goods that are not produced in Australia, ensuring that Australian industries are not unduly disadvantaged by the importation of these goods. The Tariff Concession Order No. 0904149 specifically applies to certain mixer and grader soil cutters, granting them a lower rate of customs duty, free of charge, in line with item 50 of Schedule 4 to the Customs Tariff Act 1995. The policy objective behind this measure is to support the efficient functioning of industries by ensuring access to necessary imported goods without excessive tariff burdens. The instrument was developed by the Chief Executive Officer of Customs, in accordance with the provisions of the Customs Act 1901, and became effective from the date of application, 6 February 2009.
Scope and Application
The Customs Act 1901, as applied through Tariff Concession Order No. 0904149, governs the concessions applicable to certain mixer and grader soil cutters imported into Australia. This instrument applies to any person or entity seeking to import these specific goods, providing them with a lower rate of customs duty as stipulated in the relevant Tariff Concession Order. The scope of this legislation extends to the importation of the specified goods and is applicable nationally, following the provisions of the Customs Act 1901, which is a Commonwealth Act. The order was issued under the authority of the Chief Executive Officer of Customs, who determined that no substitutable goods were being produced in Australia on the date the application was lodged. This order does not impose any liabilities on persons other than the Commonwealth and does not affect any pre-existing rights or liabilities incurred before the date of the order. Any person with an interest in the application of this concession may lodge a submission with the CEO, although in this case, no submissions were received.
Key Provisions
The key operative sections of this legislation include section 269F of the Customs Act 1901, which allows a person to apply to the Chief Executive Officer of Customs (CEO) for a Tariff Concession Order (TCO) concerning certain goods (section 269F). If the CEO is satisfied that the application meets the core criteria outlined in section 269C, they must make a written order declaring the goods subject to a lower rate of customs duty as specified in Schedule 4 to the Customs Tariff Act 1995 (section 269P(3)). The CEO must also publish a notice in the Gazette inviting submissions from any person who considers there are reasons why the TCO should not be made (subsection 269K(1)).
Under this Act, the CEO has specific obligations when considering a TCO application. Firstly, they must determine if the application is in respect of goods specified in section 269SJ, which are ineligible for a TCO. If the application is not ineligible, the CEO must assess whether it meets the core criteria set out in section 269C, which requires that on the day the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Definitions for terms such as 'goods produced in Australia', 'ordinary course of business', and'substitutable goods' are provided in sections 269D, 269E, and 269F respectively. If the CEO is satisfied that the application meets the criteria, they must make a written TCO (subsection 269P(3)).
Non-compliance with the requirements of the Customs Act 1901 may result in penalties. The Act does not specify particular offences or penalties for failing to comply with the TCO provisions. However, general penalties under the Customs Act 1901 can include fines and imprisonment for offences related to the importation or exportation of goods. The maximum penalties can vary depending on the nature and seriousness of the offence. For example, section 230 of the Act provides that a person who contravenes certain provisions may be liable to a fine of up to $22,000 for a corporation and $4,400 for an individual, or imprisonment for up to two years, or both, for less serious offences. More serious offences may attract higher penalties.
The TCO No. 0904149, which applies to certain mixer and grader soil cutters, came into force on 06 February 2009, the day the application was lodged (subsection 269S(1)). The TCO provides that these goods are subject to a lower rate of customs duty, specifically free of charge, as opposed to the general rate of 5% (subsection 269P(3)). This concession does not affect the rights of any person, other than the Commonwealth, in relation to anything done or omitted before the date of registration of the TCO. Importers of these goods can apply for a refund of duty paid on goods imported since the TCO came into force (paragraph 126(1)(r) of the Regulations). The TCO also does not impose any liabilities on any person.