EXPLANATORY STATEMENT
Tariff Concession Instrument No. 1023211
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.
Wd Lewis And Co applied for a TCO in respect of certain agricultural boom sprayers on 24 May 2010.
Instrument
TCO No 1023211 was made on 29 September 2010. It declares that those certain agricultural boom sprayers 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. 1023211 is taken to have come into force on 24 May 2010.
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, enacted by the Australian Parliament, provides a framework for the administration of customs duties and related regulations. The Act's Part XVA introduces a scheme under which Tariff Concession Orders (TCOs) can be issued by the Chief Executive Officer of Customs (CEO), reducing customs duties on certain goods. This scheme was designed to address the need for flexibility in tariff rates to support specific industries or goods where there are no domestic substitutes, thus encouraging imports and potentially reducing costs for businesses and consumers. The explanatory statement for Tariff Concession Instrument No. 1023211, made on 29 September 2010, outlines the process of applying for and granting a TCO for agricultural boom sprayers, which now attract a zero percent duty rate, down from the standard 5 percent. This particular instrument was enacted without any objections following public consultation, ensuring that the decision-making process was transparent and inclusive.
Scope and Application
The Tariff Concession Instrument No. 1023211 under the Customs Act 1901 applies specifically to the concession of customs duty for certain agricultural boom sprayers. This legislation is applicable to those who import these specified goods, allowing them to benefit from a reduced duty rate, in this case, from 5% to free. The Act operates within the Commonwealth jurisdiction and impacts the customs duty regime concerning the importation of these goods into Australia. It is pertinent to note that the application of this tariff concession does not retroactively affect the rights or liabilities of any party prior to the instrument's effective date, which is the date the application for the tariff concession was lodged. Moreover, the application process requires that the goods in question are not substitutable by any goods produced in Australia in the ordinary course of business, as defined by the Act, and does not include certain goods specified in section 269SJ of the Act. The instrument was made without any submissions opposing the concession, thereby streamlining the process and ensuring its effectiveness from the specified commencement date.
Key Provisions
The Tariff Concession Instrument No. 1023211, made under the Customs Act 1901, applies to certain agricultural boom sprayers, reducing the rate of customs duty from the general rate of 5% to free, as specified in item 50 of Schedule 4 to the Customs Tariff Act 1995 (subsection 269P(3)). The application for a Tariff Concession Order (TCO) was submitted by Wd Lewis And Co on 24 May 2010, and the CEO of Customs made the order on 29 September 2010, after being satisfied that no substitutable goods were produced in Australia (section 269C).
The obligations under this legislation primarily involve the CEO of Customs, who is responsible for deciding whether an application for a TCO meets the core criteria. These criteria include verifying that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged (section 269C). The CEO must also ensure that the goods in question are not specified in section 269SJ of the Act, which lists goods that cannot be subject to a TCO. Upon meeting these criteria, the CEO must issue a written TCO order (subsection 269P(3)). Additionally, the CEO must publish a notice in the Gazette inviting submissions from interested parties regarding the TCO application (subsection 269K(1)).
Breaching the provisions of the Customs Act 1901 can lead to various penalties. While the Explanatory Statement does not explicitly detail these, under the general framework of the Customs Act, violations can result in civil or criminal penalties. Civil penalties might include fines, while criminal penalties could involve imprisonment. The specific penalties would be determined by the relevant sections of the Customs Act and associated regulations. The Act ensures that the rights of persons other than the Commonwealth are not adversely affected by the TCO, and it does not impose any new liabilities on any person.