Last month we reported on changes to the Customs Tariff Act, to implement the 2022 Harmonized classifications (HS2022).
The Australian Border Force (ABF) has now issued guidance on a number of other changes to the system. They have issued Australian Customs Notice No. 2022/05: Indexation of customs duty rates on excise-equivalent goods on 01 February 2022.
The notice sets out the new customs duty rates for certain excise-equivalent goods, including spirits, beers and fuel products, operative from 01 February 2022.
Section 19 of the Customs Tariff Act (1995) provides for customs duty rates for certain excise-equivalent goods to be indexed biannually, in February and August, to the Consumer Price Index (CPI).
The new rates are determined by the application of an indexation factor. This indexation factor is calculated by dividing the most recent June or December Quarter CPI number by the previous highest June or December Quarter CPI number occurring after the June 1983 Quarter. The June 2021 Quarter CPI figure (118.8) will be used to determine the indexation factor for the duty rate increase applied on 1 February 2022, as it is higher than the previously used December 2020 Quarter CPI figure (refer to ACN 2021/30).
On 25 January 2022, the Australian Bureau of Statistics released the December 2021 Quarter CPI figure (121.3).
The figures used to calculate the indexation factor for February 2022 are set out as being:
Most recent CPI number: 121.3
Highest previous June or December Quarter Indexation Factor: 118.8
December Quarter 2021 June Quarter 2021: 1.021
As the indexation factor for February 2022 (1.021) is greater than one, customs duty rates for certain excise-equivalent goods, in Schedule 3 of the Customs Tariff, will increase by the application of this factor.
To read the full 58-page Customs Notice, follow THIS LINK which sets out the rates of customs duty for excise-equivalent goods, operative from 01 February 2022.
Please note they supersede the rates outlined in Australian Customs Notice 2021/30.
The Australian Tax Office (ATO) also provides information on excise duty rate for alcohol at this LINK; and on excise duty rates for fuel at this LINK.
The information provided by the government can be confusing to many importers, so we recommend you call us here at Colless Young for discussion on the changes and how they relate to your business.
As a licensed Customs Broker and International Freight Forwarder, Colless Young offers you professional advice on Customs tariffs and import duty. We provide a complete range of logistics services, both air and sea cargo, for all your import and export shipping and trade activities; we’ll give you correct advice on current shipping schedules, freight rates and terminal fees. We also handle trucking, warehousing, customs clearance, quarantine inspections and fumigation treatment.
