EXPLANATORY STATEMENT
Tariff Concessions Revocation Instrument 7/2012
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(2A) of the Act provides that if, because of an amendment of the Customs Tariff Act 1995, the CEO is satisfied that the tariff classification that is stated in a TCO to apply to the goods the subject of the TCO will not, with effect from a particular day, apply 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 that day.
Instrument
Tariff Concessions Revocation Instrument Number 7/2012 was made on
22 November 2011. This instrument revokes 1119542 of classification 3005.90.90 and makes new TCO 1135153 of classification 9619.00.10. The instruments reflect changes to the Customs Tariff Act 1995 contained in the Customs Tariff Amendment (2012 Harmonized System Changes) Act 2011, which took effect from 1 January 2012.
Consultation
No consultation was undertaken since the change is minor or machinery in nature and does not substantially alter existing arrangements.
Commencement
Subsection 269SD(2A) provides that the orders revoking the TCOs have effect from the day that the CEO is satisfied that the tariff classifications stated to apply to the goods the subject of the TCOs will not apply to those goods. Further, the new TCOs have effect from that day. Tariff Concessions Revocation Instrument Number 7/2012 revokes TCO 1119542 and makes new TCO 1135153 in its place, with effect from 1 January 2012.
Overview
The Tariff Concessions Revocation Instrument 7/2012 was enacted to address discrepancies arising from changes to the Customs Tariff Act 1995, specifically the Customs Tariff Amendment (2012 Harmonized System Changes) Act 2011. This instrument, made under the authority of the Customs Act 1901, operates to ensure that Tariff Concession Orders (TCOs) remain accurate and applicable to the correct tariff classifications. The instrument revokes TCO 1119542 and introduces TCO 1135153, reflecting the amendments that took effect from 1 January 2012. This change is necessary to maintain the integrity of the tariff concession scheme and ensure that the appropriate duty rates are applied to the relevant goods. The policy objective of this instrument is to streamline and update the tariff concession orders in line with the updated tariff classifications, thereby avoiding any potential confusion or misapplication of duties.
Scope and Application
The Customs Act 1901 provides a framework for the imposition and management of customs duties on imported goods, including the ability to grant tariff concessions through Tariff Concession Orders (TCOs). Under this legislation, the Chief Executive Officer of Customs can revoke and replace TCOs when there are amendments to the Customs Tariff Act 1995. The Tariff Concessions Revocation Instrument 7/2012 revokes and replaces TCO 1119542, which was related to goods classified under 3005.90.90, with a new TCO 1135153, reflecting the new classification 9619.00.10. This change was implemented to align with updates to the Customs Tariff Act 1995 brought about by the Customs Tariff Amendment (2012 Harmonized System Changes) Act 2011, which took effect from 1 January 2012. The instrument applies to any goods that were previously covered under TCO 1119542, ensuring that customs duties are applied correctly in accordance with the updated tariff classifications.
Key Provisions
The Tariff Concessions Revocation Instrument 7/2012 primarily operates under sections 269C and 269P of the Customs Act 1901. These sections detail the process by which the Chief Executive Officer of Customs (CEO) can make or revoke Tariff Concession Orders (TCOs). A TCO allows for a lower rate of customs duty on specified goods, provided certain criteria are met, notably that no substitutable goods are produced in Australia on the day the application is lodged. The instrument in question revokes TCO 1119542, which had classified certain goods under category 3005.90.90, and replaces it with a new TCO 1135153, categorising the same goods under 9619.00.10. This change follows amendments in the Customs Tariff Act 1995, which were enacted through the Customs Tariff Amendment (2012 Harmonized System Changes) Act 2011.
The obligations imposed by this Act primarily fall on the CEO of Customs, who is responsible for making or revoking TCOs. The CEO must ensure that any TCOs remain accurate in light of amendments to the Customs Tariff Act 1995. Specifically, if the CEO is satisfied that the tariff classification in a TCO will no longer apply to the goods due to such amendments, they must revoke the existing TCO and issue a new one. This ensures that the customs duty rates on specific goods remain aligned with the updated tariff classifications.
Breaching the requirements set out by this Act can result in significant consequences. If the CEO fails to revoke a TCO when necessary or does not issue a new TCO, the applicable tariff rates may not be correctly applied. This could lead to either over- or under-assessment of customs duties, which would be considered a breach of the Act. The precise penalties for such breaches are not explicitly stated in the explanatory statement, but they would likely involve financial penalties or corrections to the affected customs duties. The potential consequences underscore the importance of the CEO's role in maintaining accurate and compliant tariff classifications.