EXPLANATORY STATEMENT
Tariff Concessions Revocation Instrument 21/2006
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 and revoked 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 sections 269C and 269P of the Act, a TCO will be made if the application for the TCO meets the core criteria, that is, on the day on which the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business.
Subsection 269SD(2) of the Act provides that if the CEO is satisfied that:
− because of an amendment of the Customs Tariff Act 1995; or
− having regard to a decision of a court of the Administrative Appeals Tribunal; or
− having regard to written advice on the matter given by an officer of Customs;
the tariff classification that is stated in a TCO to apply to the goods the subject of the TCO has not, with effect from a particular day, applied to those goods, the CEO must:
− make an order revoking the TCO with effect from that day; and
− make a new TCO in respect of the goods with effect from the revocation.
Instrument
Tariff Concessions Revocation Instrument No 21/2006 was made on 15 March 2006. It revokes TCO 0102024 and makes TCO 0605246. The tariff classification has been changed from 8418.69.00 to 8418.61.00 because of a tariff classification change.
Consultation
No consultation was undertaken since the change is minor or machinery nature and does not substantially alter existing arrangements.
Commencement
Subsection 269SD(2) provides that the order revoking the TCO has effect from the day on which the tariff classification did not apply to the goods. Further the new TCO has effect from the revocation. Subsection 269SD(4) provides that the day may be the day on which the old TCO came into force or a later day.
Subsection 269SD(6) provides that section 269SD has effect despite section 12 of the Legislative Instruments Act 2003. Section 12 prohibits the making of certain retrospective legislative instruments.
Tariff Concessions Revocation Instrument No. 21/2006 revoked 0102024 and made new TCO 0605246 on 15 March 2006.
Overview
The Tariff Concessions Revocation Instrument 21/2006 was enacted under the Customs Act 1901 to address discrepancies in tariff classifications resulting from changes to the Customs Tariff Act 1995 or decisions of the Administrative Appeals Tribunal. This legislative instrument was introduced to ensure that tariff concessions on certain goods remain accurate and compliant with current tariff classifications, thereby maintaining the integrity of the customs duty system. The instrument was created by the Chief Executive Officer of Customs in accordance with sections 269C, 269P, and 269SD of the Customs Act 1901. The primary policy objective is to provide a mechanism for the revocation and reissuance of Tariff Concession Orders (TCOs) when there is a change in tariff classification, thereby ensuring that the correct duty rates are applied to imported goods. The instrument was enacted without consultation as the changes were considered minor and of a machinery nature, not substantially altering existing arrangements.
Scope and Application
The Customs Act 1901, specifically Part XVA, governs the creation and revocation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs. This Act applies to goods subject to TCOs, ensuring that lower rates of customs duty are applied where no substitutable goods are produced in Australia. Section 269C and 269P of the Act outline the criteria for establishing a TCO, which is contingent upon the absence of locally produced alternatives at the time of application. The instrument in question, Tariff Concessions Revocation Instrument No 21/2006, was made on 15 March 2006 to address the revocation of TCO 0102024 and the introduction of TCO 0605246. This change was prompted by a shift in tariff classification from 8418.69.00 to 8418.61.00 due to an amendment in the Customs Tariff Act 1995. The revocation and creation of new TCOs are effective from the date when the prior tariff classification ceased to apply, as mandated by subsection 269SD(2) of the Act. This instrument operates across the Commonwealth, affecting entities and individuals dealing with the specified goods, and it is enforceable despite provisions in the Legislative Instruments Act 2003 that generally prohibit retrospective legislative instruments.
Key Provisions
The Tariff Concessions Revocation Instrument 21/2006, under the Customs Act 1901, operates through sections 269C, 269P, and 269SD, among others, to address tariff concession orders (TCOs). Specifically, section 269C and 269P allow the Chief Executive Officer (CEO) of Customs to create TCOs that apply lower rates of customs duty to certain goods, provided that no substitutable goods are produced in Australia at the time of the application. Section 269SD(2) mandates that the CEO must revoke a TCO and issue a new one if the tariff classification specified in the existing TCO no longer applies due to changes in the Customs Tariff Act 1995, decisions from the Administrative Appeals Tribunal, or advice from Customs officers.
Under this legislation, the CEO's obligations include ensuring that any TCO remains valid based on the current tariff classification. This requires the CEO to monitor changes in tariff classifications and make adjustments as necessary. For example, if a TCO specifies a tariff classification that becomes outdated due to changes in the Customs Tariff Act, the CEO must revoke the existing TCO and issue a new one with the updated classification. The CEO is also responsible for communicating these changes to the relevant parties to ensure compliance with the new tariff classifications.
Breaching the provisions of this Act can lead to various consequences. For instance, failure to comply with the updated tariff classifications could result in the imposition of incorrect customs duties. This non-compliance might attract penalties under the Customs Act, which could include fines or other administrative actions. Although the explanatory statement does not specify exact penalties, breaches of the Customs Act generally entail civil or criminal penalties, including fines and potential imprisonment, depending on the severity of the breach and the intent behind it. The consequences underscore the importance of adhering to the tariff classifications and the changes mandated by the CEO.