Bills Digest No. 160 2002-03
Customs Tariff Amendment Bill
(No. 1) 2003
WARNING:
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 Bill.
CONTENTS
Passage History
Purpose
Background
Main Provisions
Concluding Comments
Endnotes
Contact Officer & Copyright Details
Passage History
Customs
Tariff Amendment Bill
(No. 1) 2003
Date Introduced:
15 May 2003
House:
Representatives
Portfolio:
Justice and Customs
Commencement:
On the day on which the Act receives the Royal Assent except
for the Schedule 1 amendment relating to East Timor(1) which
is made retrospective to 1 April 2003 and the Schedule 2 amendments relating
to Least Developed Countries (LDCs) and which commence on 1 July 2003.
Schedule 3 relates to the Singapore-Australia Free Trade Agreement (SAFTA)
and the amendments commence on the day on which SAFTA enters into force.
The purpose of the Bill is to amend the Customs Tariff
Act 1995 to allow preferential duty treatment (i.e. duty free) for
the importation of goods that are the produce or manufacture of LDCs and
East Timor, and from Singapore
under trade liberalisation initiatives.
Background
The background to the Bill is found in the accompanying
Bills Digest No. 159, 2002–03 for the Customs Amendment Bill (No. 1) 2003.
The Customs Tariff Act 1995 imposes Customs duties
on goods imported into Australia
utilising an international harmonised tariff classification system.
Item 1 amends the Customs Tariff Act 1995
to insert 'East Timor' in Schedule 1 to that Act.
The schedule sets out the countries and places to which special rates
of duty apply under the Australian system of tariff preferences. The reference
to 'ETIM' is the country abbreviation for East Timor.
This amendment has a retrospective commencement to 1
April 2003. As from that date, goods from East
Timor will be given a preference of five percentage points
below the general tariff rate, where applicable.
It is noted that the country abbreviation for East
Timor in the separate revision of Schedule 1 (see Item
13, below) lists East Timor as 'TL' reflecting
East Timor's preference for the name Timor-Leste.
On 25 October
2002, the Prime Minister, the Hon. John Howard
MP, announced at the APEC Leaders CEO Summit in Los
Cabos that Australia
will grant tariff and quota free access for 50 of the world's poorest
countries.(2) These are referred to as Least Developed Countries
(LDCs) and they include countries such as Bangladesh,
Cambodia
and many parts of sub-Saharan Africa. Preferential
access assists LDCs to integrate with the world economy.
Schedule 2 amends the Customs Tariff Act 1995
to give effect to the Government's commitment to LDCs. The proposed amendments
are to commence on 1 July 2003 consistent with Australia's
public commitment to assist LDCs.
Items 1 to 12 deal with definitional matters and
cross-referencing within the Tariff.
Item 13 replaces Parts 1, 2 and 3 of existing
Schedule 1 to the Tariff with four new Parts. Schedule 1 is a list of
countries by name and abbreviation to which special preferential rates
of tariff apply. The existing Part 1 lists the Forum Island Countries
in the Pacific, such as the Cook Islands, Nauru
and Fiji.
Existing Parts 2 and 3 list Developing Countries throughout the world
to which separate rates of tariff, respectively, apply. Included within
the listing is some 'places' treated as Developing Countries, such as
the Falkland Islands and Dependencies.
The revision of Schedule essentially adds the list of
LDCs and East Timor (treated as an LDC— i.e. the
proposed Division 2 of Part 2 of the proposed revised list). Taken overall,
the proposed amendments revise and update the lists in Schedule 1 to the
Tariff.
Items 17 to 34 make adjustments to Schedule 3
of the Tariff to apply a Customs rate equivalent to the Australian domestic
excise rate for alcohol, tobacco and petroleum on products imported
from LCDs. Otherwise, the duty free rate of entry for these products
from LDCs would be inconsistent with the treatment of the domestic product.
Likewise, item 42 applies a duty rate to goods to which the Product
Stewardship Oil Levy applies. The levy is imposed on certain petroleum
based oils and greases and their synthetic equivalents to fund a recycling
program for waste oil.
The Singapore–Australia Free Trade Agreement (SAFTA)
is a bilateral agreement that provides Singapore
and Australia
with more liberal access to each other's goods, services and investment
markets. SAFTA was signed on 17
February 2003 and tabled in Parliament on 4 March 2003. SAFTA is expected to come into force
in the financial year 2003-04, subject to Australia's
treaty process and the exchange of diplomatic letters.
Schedule 3 amends the Customs Tariff Act 1995
to give effect to Australia's
treaty obligations under SAFTA. Schedule 3 commences the day on which
SAFTA enters into force.
Items 1 to 12 deal largely with the revision of
definitional matters and cross-referencing within the Tariff.
Item 13 adds a proposed new Part 5 to Schedule
1 to the Tariff. This proposed amendment enables goods of Singapore
origin to be recognised for preferential tariff purposes.
Items 14 to 31 make adjustments to Schedule 3
of the Tariff to apply a Customs rate equivalent to the Australian domestic
excise rate for alcohol, tobacco and petroleum products imported
from Singapore.
Otherwise, the duty free rate of entry for these products from LDCs would
be inconsistent with the treatment of the domestic product. Likewise,
item 38 applies a duty rate to goods to which the Product Stewardship
Oil Levy applies. The levy is imposed on certain petroleum based oils
and greases and their synthetic equivalents to fund a recycling program
for waste oil.
The same concluding comments as are found in the
accompanying Bills Digest No. 159, 2002–03 for the Customs Amendment Bill
(No. 1) 2003 apply to this related Bill.
- As a courtesy, it is noted that the nation of East
Timor prefers the name Timor L'Este (also expressed as Timor-Leste).
See the comments of Mr K. W. Wilkie MP,
Second Reading debate in the House of Representatives, Debates,
5 March 2003, p. 12299.
- The Hon. John Howard MP,
Prime Minister, 'Tariff-Free Access for the World's Poorest Countries',
Media Release, 25 October
2002.
Brendan Bailey
27 May 2003
Bills Digest Service
Information and Research Services
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ISSN 1328-8091
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