Bills Digest no. 64 2009–10
Customs Tariff Amendment (Incorporation of Proposals)
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
Sections 1 to 3 commence
on the day of Royal Assent, Schedule 1 commences on 1 January 2009,
Schedule 2 on 6 March 2009 and Schedule 3 on 28 August
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
To amend the Customs Tariff
Act 1995 (the Act) to incorporate
- an additional item into Schedule 4 of the Act concerning
concessional rates of duty (Customs Tariff Proposal No. 1) 2009
(motor vehicle manufacture),
- increased rates of tariff incorporated into Schedule 7 (Chilean
originating goods) contained in the Customs Tariff Proposals (No.
2) 2009 (Alcopops and tobacco-Chilean goods)
- amendments to rates of duty contained in Customs Tariff
Proposals (No. 4) 2009 (beer and wine).
Alterations proposed to the Customs Tariff Act 1995 and
the Excise Tariff Act 1921 are done by means of excise and
customs tariff proposals which are introduced and tabled in
The Australian House Practice explains that changes to customs
and excise tariffs require a mechanism whereby changes to the
tariffs can be applied quickly. To initiate changes by means of
introducing a bill into Parliament would be impractical because of
the time processes involved in passing a bill through Parliament.
Such measures (proposals) are generally introduced by way of motion
in the form of customs tariff and excise tariff proposals. These,
as proposals dealing with taxation may be submitted to the House
without notice. 
The collection of duty commences as the House Practice states, on
the authority of an unresolved motion, and this has been accepted
as a convention.
The Bill validating the imposition of the tariff changes
retrospectively apply the changes to the date that the tariff
changes commenced by means of the Customs Tariff Proposal. There
has been some controversy relating to the arrangements of tabling
tariff proposals to be later validated by legislation which is
subsequently rejected and requires a return of the funds
The Customs Tariff Proposal (No. 1) 2008 (alcopops) and the
Excise Tariff Proposal (No. 1) 2008 (alcopops) were tabled on 13
May 2008. The validating legislation was introduced in February
2009 but was subsequently rejected in the Senate. For a detailed
coverage of the background to these and the subsequent Bills which
ultimately passed see the following:
Customs Tariff Amendment (2009 Measures No. 1) Bill 2009
Excise Tariff Amendment (2009 Measures No. 1) Bill bills
Customs Tariff Amendment (2009 Measures No. 1) Bill [No. 2]
Excise Tariff Amendment (2009 Measures No. 1) Bill [No. 2]
Customs Tariff Validation Bill 2009
Excise Tariff Validation Bill 2009 bills
For a chronology of the customs and excise tariff proposals and
validating legislation see attached appendix.
The Bill has been examined by the Senate Scrutiny of Bills
Committee and the Committee commented in the Alert Digest on the
retrospective commencement provisions. They stated that items 2, 3
and 4 of the commencement table have retrospective commencement
provisions. The Committee as a matter of practice draws attention
to a bill that seeks to have a retrospective impact and will
comment adversely where such a bill has a detrimental effect on
people.  However
in the case of this Bill, the Committee commented on the clear
explanation provided by the Explanatory Memorandum of the process
employed in altering the Customs Tariff Act 1995. It
explained that because of the short timeframe for effecting changes
to the Act, Customs Tariff Proposals are used to effect such
changes quickly which cannot be done through a Customs Tariff
The explanatory memorandum also explains that
the commencement provisions reflect those of the relevant Customs
Tariff Proposal and, since there is a time lag between the tabling
of a Proposal in the House of Representatives and the passage of
the associated bill through the Parliament, the commencement
provisions of the bill are necessarily retrospective.
The Committee had no further comment to make on the bill.
The Bill proposes to incorporate the changes contained in
Customs Tariff Proposals (No. 1) 2009 (goods for motor vehicle
manufacture), Customs Tariff Proposal (No. 2) (alcopops and
tobacco-Chilean goods) and Customs Tariff Proposal (No. 4) (beer
and wine). The majority of the changes proposed in
Schedules 2 and 3 of the Bill concern amendments to the
Classification of goods and general and special rates of
duty and Chilean originating goods.
The Explanatory Memorandum explains that the Customs Tariff
Amendment (Australia-Chile Free Trade Agreement Implementation) Act
2008 was assented to on 27 November 2008 and commenced on 6
March 2009. The passing of that legislation implemented Australia s
tariff commitments under the Australian-Chile Free Trade
The Explanatory Memorandum states that the measures in the Bill
have no financial impact.
Schedule 1 Customs Tariff Proposal (No. 1)
Item 1 incorporates a new item
41H into Schedule 4 of the Customs Tariff Act
1995 (proposed in Customs Tariff Proposal (No. 1)). Schedule 4
relates to concessional rates of duty and this change will provide
for a concessional rate to apply to goods used in motor vehicle
design or engineering relating to testing, quality control,
manufacturing evaluation or engineering development.
Items 1 to 53 increase the rates of duty in
accordance with Customs Tariff Proposal (No. 2) which implements
increases in rates of duty as a result of movements in the February
2009 Consumer Price Index. The Explanatory Memorandum states that
these increased rates apply to increased rates of excise equivalent
customs duty applicable to certain spirit-based alcoholic
beverages, also known as ready-to-drink beverages or alcopops.
These changes also ensure that the customs duty on alcohol and
tobacco products imported from Chile are in line with duty imposed
on these types of products from other countries. The Customs
Tariff Amendment (2009 Measures No. 1) Act 2009 which received
Royal Assent on 27 August 2009, allowed the higher rates of duty to
be incorporated in the Customs Tariff Act 1995.
Customs Tariff Proposal (No. 4) proposes the following changes
to the Customs Tariff Act 1995:
- Schedule 3 Classification of goods and general and special
rates of duty items 1-8,
- Schedule 5 US originating goods items
- Schedule 6 Thai originating goods items 16-24,
- Schedule 7 Chilean originating goods items
The Explanatory Memorandum states that the Government announced
in the 2009-10 Budget that it would alter the taxation definitions
of beer and grape wine product to ensure that these goods that
mimic spirit based products are taxed as a spirit product.
Movements in the CPI in relation to these products rose in the
June quarter. These increases took effect as from 1 August 2009. At
that point the Customs Tariff Amendment (2009 Measures No. 1) Bill
2009 was still being debated in Parliament. This Bill now proposes to amend the
Customs Tariff Act 1995 in relation to those
Customs Tariff Proposal (No. 1 alcopops) 2008
Excise Tariff Proposal (No. 1 alcopops) 2008 Tabled on 13/5/08.
Customs Tariff Proposal (No. 1 motor vehicle goods) Tabled
Customs Tariff Proposal (No. 2 alcopops Chilean goods Feb09 CPI)
Customs Tariff Proposal (No. 3 alcopops- June09 CPI) Tabled
Excise Tariff Proposal (No. 1 alcopops) Tabled 12/5/09
Customs Tariff Proposal (No. 4 definitions of beer and grape wine
product ) Tabled 16/9/09
Customs Tariff Amendment (2009 Measures No. 1) Bill 2009
Excise Tariff Amendment (2009 Measures No. 1) Bill 2009
House of Representatives Introduced 11/2/09 Passed 25/2/09
Senate Introduced 11/3/09 Negatived at 3rd reading
Rejected by the Senate 18/3/09
Customs Tariff Validation Bill 2009
This Bill proposed the validation of customs duties demanded or
collected before 14 May 2009 to ensure that the duties were
lawfully imposed and collected.
House of Representatives Introduced 12/5/09 Passed 12/5/09
Senate Introduced 12/5/09 Passed 13/5/09
Assent 13/5/09 Act No. 29 2009
Customs Tariff Amendment (2009 Measures No. 1) Bill 2009 (No.
Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 (No. 2)
House of Representatives Introduced 22/6/09 Passed 22/6/09
Senate Introduced 23/6/09 Passed 13/8/09
Assent 27/8/09 Act No. 74 2009 (Customs Tariff)
Assent 27/8/09 Act No. 73 2009 (Excise Tariff)
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information from the Parliamentary Library on (02) 6277 2784.
17 November 2009
Bills Digest Service
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