Chapter 2
Overview of the bills
The Customs bill
2.1
The Customs Amendment (China-Australia Free Trade Agreement
Implementation) Bill 2015 (Customs bill) amends the Customs Act 1901
(Customs Act) to implement Australia's obligations under Chapter 3 of ChAFTA.
2.2
Chapter 3 of ChAFTA sets out the criteria for determining the
eligibility of goods to obtain preferential tariff entry into Australia
(whether a good 'originates' in Australia or China), known as the 'rules of
origin'.[1]
Chapter 3 also sets out the process for production of Certificates of Origin including
by 'authorised bodies' and the process for self-certification in specified
circumstances.[2]
2.3
The key provisions of the Customs bill are contained in the three parts
of Schedule 1.
2.4
Part 1 of Schedule 1 inserts a new Division 1L into Part VIII of the
Customs Act. Titled 'Chinese originating goods', the new division will set
out the rules for determining whether goods are Chinese originating goods and
therefore eligible for a preferential rate of customs duty under the Tariff Act.
2.5
Part 2 of Schedule 1 inserts new Division 4J, 'Exportation of goods to
China' into Part VI of the Customs Act. The new division will impose
obligations on people who export goods to China and who wish to obtain
preferential treatment.
2.6
Proposed new section 126AOB provides that the regulations may prescribe
recording keeping obligations on exporters or producers of goods exported to
China and claimed to be Australian originating goods for the purpose of
obtaining a preferential tariff in China.
2.7
Proposed sections 126AOC and 126AOD would allow an authorised officer to
require a person subject to the record keeping obligations to produce records
and answer questions to verify the origin of goods. Authorised officers may,
for the purpose of verifying a claim for a preferential tariff in China,
disclose records and answers to Chinese customs officials.
2.8
It is noted that failure to produce a record or answer a question when
required to do so by an officer may be an offence under the Customs Act.
However, a person does not have to produce a record or answer a question if it
would incriminate the person.
2.9
Part 3 provides for the application of Parts 1 and 2.
The Tariff bill
2.10
The Customs Tariff Amendment (China-Australia Free Trade Agreement
Implementation) Bill 2015 (Tariff bill) amends the Customs Tariff Act 1995
(Tariff Act). According to the Second Reading Speech, the Tariff bill will
implement ChAFTA by:
-
providing duty-free access for certain goods and preferential
rates of customs duty for other goods that are Chinese originating goods;
-
creating a new Schedule 12 to provide for phasing rates of duty
for those goods and to specify excise-equivalent duties on certain alcohol,
tobacco and petroleum products;
-
phasing these preferential rates of customs duty to be 'free' of
customs by the fifth year of phasing; and
-
amending Schedule 4 to maintain customs duty rates for certain Chinese
originating goods in accordance with the applicable concessional item.[3]
Financial impact
2.11
The removal of tariffs on imports under ChAFTA will lead to reductions
in tariff revenue. The financial impact statement for the bills estimates that
tariff revenue would decline by $4,150 million over the forward estimates.[4]
However, this figure does not include the second-round effects on government
revenue from increased economic activity, which are expected to be positive.[5]
Navigation: Previous Page | Contents | Next Page