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CUSTOMS REGULATIONS (AMENDMENT) 1992 NO. 447
EXPLANATORY STATEMENTSTATUTORY RULES 1992 No. 447
Issued by the Authority of the Minister for Small Business, Construction and Customs
Customs Act 1901
Customs Regulations (Amendment)
Section 270 of the Customs Act 1901 (the Act) provides in part that:
"(1) The Governor-General may make regulations not inconsistent with this Act prescribing all matters which by this Act are required or permitted to be prescribed ... for giving effect to this Act or for the conduct of any business relating to the Customs, ..."
The Regulations amend the Customs Regulations (the Regulations) to:
i) give effect to the Government's decision to simplify the system of tax free sales to international travellers;
ii) provide a rebate of Customs duty paid on diesel fuel to the purchaser of the fuel where the diesel fuel has been used in the manufacture of explosives; and
iii) allow single-seat open-wheel racing cars to be eligible for duty free importation via a Tariff Concession Order (TCO).
Duty free goods for international travellers
Section 96A of the Act and regulation 93 of the Regulations govern the control and administration of outwards duty free shops. In particular, subsection 96A(2) of the Act provides a Collector with the ability to grant a permission for goods purchased by international travellers from an outwards duty free shop to be delivered to the traveller personally for export by him or her on the relevant international flight, without the need to make an export entry. Such permission may be subject to conditions prescribed in the Regulations (subsection 96A(5) refers).
Subregulations 93(7) and 93(8) of the Regulations prescribe the conditions to which a permission in respect of goods purchased from off-airport duty free shops and on-airport duty free shops respectively, are subject.
Regulation 3 therefore amends regulation 93 of the Regulations to simplify and reduce the reporting requirements of duty free shop proprietors along similar fines to the recent amendments contained in the Sales Tax Assessment Regulations (SR No. 365 of 1992),
Diesel fuel used in the manufacture of explosives
Section 163 of the Act provides that refunds, rebates and remissions of duty may be made in such circumstances and subject to such conditions and restrictions as are prescribed by the Regulations. Regulation 126 prescribes then lists the circumstances in which such refunds, rebates or remissions can be made.
The Government has previously decided that diesel fuel used for a non-fuel purpose should be subject to customs duty. One particular use for diesel fuel is as an ingredient in the manufacture of explosives, which is clearly a non-fuel use. To give effect to the Government's decision, whilst ensuring adequate controls over the revenue are maintained, subregulation 4.2 provides for a rebate of Customs duty where a person has purchased diesel fuel for use as an ingredient in the manufacture of explosives.
Allow single-seat open-wheel racing cars to be eligible for a TCO
Regulation 7 gives effect to the decision of the Government on 22 September 1992 to remove single-seat open-wheel racing cars from the class of goods excluded from eligibility for a TCO. The retrospective commencement of this regulation provided for by subregulation 1.2 does not offend subsection 48(2) of the Acts Interpretation Act 1901 as it confers a benefit upon importers of single-seat open-wheel racing cars and does not impose any liabilities on any person.
The Regulations also effect a minor technical amendment to regulation 126 to correct a drafting error in Statutory Rules 1992 No. 343 which resulted in two paragraph "q"s being inserted into the refund circumstance provision. Consequential technical amendments are also proposed to regulations 128A and 128AB to correct cross references to the affected refund circumstance.
The Regulations commence on Gazettal, with the exception of regulation 3 which commences on 1 January 1993, which is the date that the equivalent sales tax amendments which are referred to above commence and regulation 7 which provides for TCO eligibility for single-scat open-wheel racing cars which commenced on 22 September 1992.
The Regulations amend the Customs Regulations as follows:
Subregulation 1.1 provides that Regulation 3 commences on 1 January 1993, which is the date on which the equivalent sales tax amendments contained in the Sales Tax Assessment Regulations (Statutory Rules No. 365 of 1992) are due to commence.
Subregulation 1.2 provides that regulation 7 is taken to have commenced on 22 September 1992, which is the date of the Government's decision to remove single-seat open-wheel racing cars from the class of goods excluded from eligibility for a TCO.
This retrospectivity does not offend subsection 48(2) of the Acts Interpretation Act 1901 as it confers a benefit (making such goods retrospectively eligible for duty-free entry via a TCO) and does not impose any liabilities on any person.
2. Amendment
Subregulation 2.1 is a formal machinery provision which provides that the Customs Regulations are amended as set out in these Regulations.
3. Regulation 93 (Outwards duty free shops)
Subregulation 3.1 omits paragraph 93(7)(b) as a consequence of the new requirement for the proprietor to record the airline ticket/travel document number on the invoice for the goods rather than the previous situation whereby the proprietor had to make and retain a copy of the ticket or other document (Subregulation 3.7 also refers).
Subregulation 3.2 amends paragraph 93(7)(c) to extend the time within which a traveller may take delivery prior to departure from 10 days prior to departure to 30 days prior to departure. The amendment is intended to allow greater flexibility to travellers when purchasing duty free goods.
Subregulation 3.3 in effect deletes sub-subparagraph 93(7)(d)(ii)(C). The reason for the deletion is that the provision is unnecessary because the traveller's details are on the invoice which is attached to the outside of the package containing the goods. Paragraph 93(7)(d) requires duty free goods which are delivered to a relevant traveller to be packaged in a particular manner. Sub-subparagraph 93(7)(d)(ii)(C) had required the name of the relevant traveller to be marked on the outside of the package.
Subregulation 3.4 amends subparagraph 93(7)(d)(iii) to require that the package not simply be transparent, but rather transparent enough for the goods to be easily identified. The amendment is intended to reconcile the conflicting requirements for the package to be sealed and yet for Customs to be able to verify its contents.
Subregulation 3.5 amends paragraph 93(7)(e) so as to restrict the condition imposed by that paragraph to duty free sales which require the goods to be in a sealed package, rather than to duty free sales generally. In effect this means that the conditions in question will apply to any duty free or sales tax free sale to Australian travellers, but will not extend to duty/sales tax free sales to foreign travellers, retail, and diplomatic and consular staff.
The latter sales, being an 'open bag' system rather than 'sealed bag' are more easily audited and reconciled and therefore do not require the same restrictive conditions to be imposed in respect of them.
Subregulation 3.6 amends sub-subparagraph 93(7)(e)(ii)(A) so as to substitute "date" for May and time" to simplify the process of preparing invoices in respect of relevant goods sold in the duty free shop.
Subregulation 3.7 amends subparagraph 93(7)(e)(ii) to require the addition of a new particular on an invoice prepared in accordance with the condition; being the ticket number or other information confirming an entitlement to the international flight.
Subregulation 3.8 amends sub-subparagraph 93(7)(e)(iii)(A) to make it sufficient to specify the quantity of the goods in figures only. The sub subparagraph is also amended however, to require the total number of items on the invoice to be specified in words, so that there can be no misunderstanding or error in respect of the total quantity specified in the invoice.
Subregulation 3.9 inserts a new sub-subparagraph 93(7)(e)(iii)(C) requiring the inclusion of the total sales value of the relevant items and their quantities, in the invoice.
Subregulation 3.10 amends paragraph 93(7)(g) to reduce the reporting burden on proprietors. That paragraph currently requires the proprietor of a duty free shop to notify a Collector at the relevant airport of departure, of particular information in relation to a sale from the duty free shop to the relevant traveller. The notification must be made not less than 2 hours before the time of departure of the relevant traveller. The amendment effected by this Subregulation, limits the notification to a case where a Collector has directed the proprietor to provide the information in relation to sales from the duty free shop (new subregulation 93(7A) inserted by Subregulation 3.17 refers).
Subregulation 3.11 further simplifies paragraph 93(7)(g) by omitting the reference to "at the relevant airport of departure" as a consequence of the amendments effected by Subregulation 3.10.
Subregulation 3.12 amends subparagraph 93(7)(g)(iv) to increase the sale value for any item in respect of which a full description is required from $200 to $500 or more.
Subregulation 3.13 is a technical drafting change to subparagraph 93(7)(j)(ii) as a consequence of the deletion of subparagraph 93(7)(j)(iii) by Subregulation 3.14.
Subregulation 3.14 deletes subparagraph 93(7)(j)(iii) as being too onerous in terms of the time constraints relevant to the passage of packages/ luggage through the airport departure area. The relevant checks are in any case effected elsewhere.
Subregulation 3.15 amends paragraph 93(7)(n) to extend the time within which a 'liability return' must be lodged with Customs from 10 days after the end of each month to 21 days after the end of each month.
Paragraph 93(7)(n) requires proprietors of duty free shops, not later than the expiration of 10 working days after the end of each month, to submit a so-called 'liability return' to a Collector. This return details the invoices prepared in respect of duty free goods delivered and intended to be exported. In that case the proprietor is required to pay an amount equal to the aggregate of the amounts of customs duty payable in respect of those nonexported goods which are specified in the return.
Subregulation 3.16 redrafts subparagraph 93(7)(n)(ii) in a simpler manner, with no intention to alter its effect as described above.
Subregulation 3.17 inserts a new subregulation (7A) in regulation 93 to limit the notification required by paragraph 93(7)(g) to a case where a Collector has directed the proprietor to provide the information in relation to sales from the duty free shop (see also Subregulation 3.10 above).
Subregulation 3.18 amends paragraph 93(8)(a) to add the requirement that the relevant traveller produce to the proprietor a ticket or other document that is evidence that the person is entitled to make an international flight.
The amendment brings the condition into line with the equivalent off-airport duty free shop condition in paragraph 93(7)(a).
Subregulation 3.19 amends paragraph 93(8)(b) so that the relevant invoice be required to be prepared in duplicate rather than triplicate.
Subregulation 3.20 amends sub-subparagraph 93(8)(b)(ii)(A) to substitute "date" for "day and time" to simplify preparation of the relevant invoice.
Subregulation 3.21 amends sub-subparagraph 93(8)(b)(iii)(A) to make it sufficient to specify the quantity of the goods in figures only.
Subregulation 3.22 inserts a new sub-subparagraph 93(8)(b)(iii)(C) requiring the inclusion of the total sales value of the relevant items and their quantities, in the invoice.
Subregulation 3.23 amends sub-subparagraph 93(8)(c)(i)(A) in the same manner as Subregulation 3.20 previously.
Subregulation 3.24 substitutes a new sub-subparagraph 93(8)(c)(iii)(A) requiring the inclusion of the total sales value of the relevant items and their quantities, in the invoice as per new sub-subparagraph 93(8)(b)(iii)(C) above (Subregulation 3.22 refers).
Subregulation 3.25 amends sub-subparagraph 93(8)(c)(ii)(B) to make it sufficient to specify the quantity of the goods in figures only.
Subregulation 3.26 deletes paragraphs 93(8)(e) and (f) as a consequence of new subregulations 93(9) and (10) (Subregulation 3.27 refers).
Subregulation 3.27 substitutes two new subregulations 93(9) and (10) as follows:
new subregulation 93(9) provides that in relation to off-airport duty free shops, the prescribed way of providing proof of export of duty free goods in accordance with paragraph 96A(10)(b) of the Act is by providing an electronic record of the invoice numbers of invoices removed from the package of the goods (new paragraph 93(9)(a)(ii)) AND
the prescribed time within which the proprietor must provide that proof to the Collector is not later than 2 working days after the day of departure of the relevant traveller from the State or Territory in which the electronic record was created (new subparagraph 93(9)(b)(i)) or 4 working days after the day of departure of the relevant traveller from any other place in Australia (new subparagraph 93(9)(b)(ii)).
new subregulation 93 (10) requires a proprietor to whom new subregulation (9) applies, to produce at the close of business on the last working day of each week, a computer generated document in an approved form listing the invoice numbers created during that week.
'Approved forms' are defined in section 4A of the Act as a form that is approved, by instrument in writing, by the Comptroller. They are disallowable instruments for the purposes of section 46A of the Acts Interpretation Act 1901.
Subregulation 3.28 adds a new subregulation 93(14) requiring relevant travellers to sign a recognition in an approved form, of the traveller's obligations concerning the export of the goods.
4. Regulation 126 (Circumstances under which refunds, rebates and remissions are made
Subregulation 4.1 amends subregulation 126(1) to omit the refund circumstance in paragraph (q).
• two different circumstances where duty can be refunded were inserted by Statutory Rules 1992 Nos. 328 and 343, both of which were numbered "paragraph (q)". Subregulation 4.2 below reinserts the second of these circumstances, renumbered as "paragraph" (r)".
Subregulation 4.2 amends subregulation 126(1) to insert 2 new refund circumstances. New paragraph (r) repeats the refund circumstance previously provided for by paragraph (q), which was omitted by subregulation 4.1 above. New paragraph (s) provides for a rebate of Customs duty where a person has purchased diesel fuel after 1 January 1990 solely for use as an ingredient in the manufacture of explosives. New subparagraph (s)(ii) ensures adequate protection of Commonwealth revenue in that a person will not be eligible for rebate under this circumstance if they have previously claimed, or intend to claim, any other rebate, remission refund or drawback in relation to that diesel fuel.
5. Regulation 128A (Time for application for refund of duty)
Subregulation 5.1 amends subregulation 128A(4B) to omit the reference to paragraph 126(1)(q) and substitute a reference to paragraph 126(1)(r).
• This is a technical amendment for the same reason as outlined in relation to subregulation 4.1 above.
6. Regulation 128AB (Circumstances in which a fee is not payable under subsection 168(1C) of the Act)
Subregulation 6.1 amends regulation 128AB to include a cross reference to paragraph 126(1)(r) so that a fee is not payable in respect of applications for refund in that circumstance.
7. Schedule 2 (Goods in respect of which concession orders must not be made)
Subregulation 7.1 amends Schedule 2 to the regulations to add "single-scat open wheel racing cars" to column 3 of item 38 so that a tariff concession order can be made in respect of those goods.
8. Application
Subregulation 8.1 provides that the amendment to regulation 126 effected by these Regulations in relation to diesel fuel used solely in the manufacture of explosives is taken to have effect from 1 January 1990, so that eligible claimants do not lose their eligibility by virtue of the 12 month limitation on lodgement of applications which would otherwise apply (regulation 128A refers).
The Regulations commence on Gazettal , with the exception of regulation 3 which commences on 1 January 1993, which is the date that the equivalent sales tax amendments which are referred to above commence and regulation 7 which provides for TCO eligibility for single-seat open-wheel racing cars which commenced on 22 September 1992.