It should be noted that the name of this Bill as
introduced on 22 October 2009 is actually the Customs Tariff
Amendment (Carbon Pollution Reduction Scheme) Bill 2009. This Bill
is identical to the earlier Bill of the same name which was first
introduced in the House of Representatives on 14 May 2009, passed
unamended on 4 June 2009, but then negatived by the Senate on 13
The addition of the reference [No. 2] has been made by
the Department of the House of Representatives Table Office to
indicate that the Bill is introduced for a second
Bills Digest no. 58 2009–10
Customs Tariff Amendment (Carbon Pollution Reduction
Scheme) Bill 2009 [No. 2]
This Digest was prepared for debate. It reflects the legislation as
introduced and does not canvass subsequent amendments. This Digest
does not have any official legal status. Other sources should be
consulted to determine the subsequent official status of the
Contact officer & copyright details
introduced: 22 October
House: House of Representatives
Portfolio: Home Affairs
The main operative
sections (Schedule 1) commence on 1 July 2011 provided that section
3 of the Carbon Pollution Reduction Scheme Act
commences before 1 July 2011. All other sections commence on the
day of Royal Assent.
relevant links to the Bill, Explanatory Memorandum and second
reading speech can be accessed via BillsNet, which is at http://www.aph.gov.au/bills/.
When Bills have been passed they can be found at ComLaw, which is
The purpose of the Bill is to ensure that reductions in fuel
excise, resulting from the government s commitment to cut fuel
taxes to offset the initial effect on fuel prices of the Carbon
Pollution Reduction Scheme (CPRS), also apply to the customs
tariffs (duty) on imported fuels.
Customs Tariff Amendment (Carbon Pollution Reduction Scheme) Bill
2009 (the original Bill) was first introduced into Parliament on 14
May 2009 as part of the 11-Bill Carbon Pollution Reduction Scheme
(CPRS) package of legislation. Along with the other CPRS Bills, the
original Bill was passed by the House of Representatives on 4 June,
but negatived in the Senate on 13 August 2009.
The content of the current Bill, now titled the Customs Tariff
Amendment (Carbon Pollution Reduction Scheme) Bill 2009 [No. 2], is
identical to the original Bill. As such, this Digest is unchanged
from the Digest
produced in June 2009 for the original Bill. For commentary on
recent developments regarding the proposed CPRS, including the
reintroduction of the CPRS Bills, see relevant sections in the
revised Digest on the Carbon Pollution Reduction Scheme Bill [No.
The Rudd Government made the commitment to cut fuel taxes in its
CPRS White Paper.
The government expects that the CPRS will result in higher fuel
prices, and proposes to cut fuel taxes to offset the initial
effects of the CPRS on prices. In essence, the proposal is a form
of adjustment assistance to fuel users. The proposals to reduce
fuel excise are contained in the Excise Tariff Amendment (Carbon
Pollution Reduction Scheme) Bill 2009 No. 2]. For further
background and information on the excise proposals, see the Bills
Digest for that Bill.
Tariffs (customs duties) on imports are set at the same levels
as excises on comparable domestically-produced goods. A lower rate
of excise than customs duty on a good would amount to protection
for local producers of that good. The Bill seeks to ensure that any
excise reductions are also incorporated into reduced customs
tariffs. As with the excise proposals, the Bill provides for:
- a reduction, on 1 July 2011, of 2.455 cents per litre in the
general rate of customs duty on fuels (38.143 cents per litre) to
35.688 cents per litre for one year
- if warranted, further customs duty reductions on five
rate-reducing days with the first additional reduction beginning on
1 July 2012 and last on 1 July 2014, and
- the amount of the reductions will depend on how much emissions
permit auction prices have increased.
This Bills Digest should be read in conjunction with the related
Bills Digest for the Excise Tariff Amendment (Carbon Pollution
Reduction Scheme) Bill 2009 [No. 2].
Details of the proposed Carbon Pollution Reduction Scheme are
set out in the Bills Digest for Carbon Pollution Reduction Scheme
At the time of writing, the current Bill has not
been referred to any committee. The original Bill, along with the
others in the CPRS package, was referred to the Senate Standing
Committee on Economics for inquiry and report by 15 June 2009.
Details of the inquiry are at
The reductions in customs tariffs will reduce revenue. How much
revenue will fall is not clear because the revenue effects are
being recalculated following the Rudd Government s decision to
delay the implementation of the CPRS for a year and set the unit
price of emissions at $10 for one year.
Schedule 1 of the Bill amends the
Customs Tariff Act 1995 (the Customs Tariff Act).
Item 1 inserts a new section
19A. Proposed subsection 19A(1) provides
for the substitution of a new customs tariff rate by allowing for,
on a rate-reducing day , the lowering of an existing rate
of customs duty (the designated amount ) by the amount of a
rate reduction .
Proposed subsection 19A(2) defines designated
amount to mean $0.35688 (that is, the amount from 1 July
2011):paragraph 19A(2)(a) or, if another amount
has been previously substituted, that substituted amount:
paragraph 19A(2)(b). This means that, under
proposed paragraph 19A(2)(b), the designated
amount can be an amount that was inserted on a rate-reducing
Proposed subsection 19A(3) provides for the
alteration of the customs tariff rates applying to different fuels,
as set out in various schedules of the Customs Tariff Act, in
accordance with proposed subsection 19A(2).
Item 2 contains bulk amendments which
substitute the first revised rate (that is, the $0.35688 per litre
applying from 1 July 2011) into the customs tariff schedule which
lists all the goods subject to duty and the respective rates of
Item 3 is an applications provision which
provides, for the absence of doubt, that the rate amendments in
item 2 apply only to goods imported into Australia on or after 1
July 2011 and goods imported into Australia before that date where
the time for working out the import duty on the goods had not
occurred before that date.
Copyright Commonwealth of Australia
Members, Senators and Parliamentary staff can obtain further
information from the Parliamentary Library on (02) 6277 2464.
29 October 2009
Bills Digest Service
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