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Importing & Exporting Laws & Regulations for Businesses in Australia
When it comes to importing and exporting, it is essential to understand the legal aspects of your operations and whether your trade complies with the country’s rules and regulations. In Australia, there are strict laws and regulations relating to the importation, exportation and/or possession of certain goods. These laws function to ensure fair trading practices and protect Australian shores by preventing the possible introduction of illegal items, dangerous products, exotic pests and diseases. It is essential that you are aware of these regulations, and how they will impact on your business’s import and export practices.
If you import goods into Australia, you will be affected by various government regulations. Even though there is no specific requirement for companies or individuals to hold an import licence, depending on the nature of the commodity, and regardless of value, owners in some instances may need to obtain permits to facilitate clearance of goods. All goods must be cleared by the Australian Customs Service (Customs), and are subject to various laws, primarily enforced through the Customs Act 1901 (Cth), which broadly regulates importation and the Customs Tariff Act 1995 (Cth), which imposes customs duty. These laws create significant requirements involving:
- Import permits
- Customs requirements
- Prohibited and restricted goods
- Quarantine requirements
- Labeling requirements
Additionally, if you are importing a product that will be used by the general public or children you will also have to meet further Australian Standards and must find out about your product requirements. Here at Quinn Lawyers we can advise you on what goods are strictly prohibited and what goods are restricted in order for your business to be able to comply with the requirements.
A duty is a tariff or tax that is applied to imported and exported commodities. Where goods are not exempt from duty under any concession, an amount of import duty will generally be payable. Rates of duty payable by an importer vary and are determined by the classification of goods within the Australian Customs Tariff. General duty rates are 5% but for goods where there are no Australian manufactured alternative it may be possible to have this reduced to 3% by application. In some circumstances, anti-dumping or countervailing measures, which result in application of additional rates of duty, may also apply.
Imported goods into Australia may be subjected to one or more indirect taxes. These indirect taxes primarily include the goods and services tax, the wine equalisation tax and the luxury car tax.
- Goods and Services Tax (GST) is payable on most imported goods including the freight and any import duty paid. There are few exemptions from the GST, including certain basic food, particular medical products and imports that qualify for certain customs duty concessions. GST is applied at 10% of the value of the taxable importation.
- Wine Equalisation Tax (WET) – is a tax on wine applied at the rate of 29%. The tax is paid on the value of the wine at the last wholesale sale, or an equivalent value when there is no wholesale sale. This tax primarily affects wine manufacturers, wholesalers and importers.
- Luxury Car Tax (LCT) – LCT applies to motor vehicles (except motor cycles or similar vehicles) that are designed to carry a load of less than two tonnes and fewer than nine passengers. As of July 2011, the tax stands at 33% LCT and applies to vehicles over $57,466.00 (including GST).
Exports from Australia are also regulated by a range of legislation, including the Customs Act 1901 (Cth) and the Export Control Act 1982 (Cth). Generally, goods to be exported must be declared for export with the Australian Customs Service and an authority to deal with the goods must be granted. However, certain goods, such as wildlife, heritage and hazardous materials, may be subject to additional requirements, which may include Federal Government approval, or even total prohibition.
Exports of most goods will be GST-free if they are exported within a specified time of receiving payment or issuing an invoice. Exports of services are also GST-free in many cases, provided that relevant requirements in the GST legislation are met. As such, it is important for your business to seek professional legal advice, which can save you costs and avoid penalties for breaches. Quinn Lawyers can help you understand the distinction between prohibits and conditions as well as help you organised all the necessary permits needed for conditional goods.
Administration and enforcement of customs obligations
Significant changes have been made to the administration and enforcement of customs obligations. Enforcement of customs obligations has become stricter, with the introduction of a range of new laws which create strict liability offences, including the failure to declare goods for export and the making of false and misleading statements. Record retention requirements have also increased, which now require businesses to maintain detailed records of certain commercial documents for up to five years from the time goods were imported or exported.
What Can We Do?
It’s important to discuss the legal restrictions for importing and exporting that might impact your business before formation, to ensure you meet with all laws. Contact us to organise a consultation with our legal team. Our dedicated team will deal with your problem in a sympathetic, time efficient and cost effective manner. Send an online enquiry or call us on +61 2 9223 9166.
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The Quinn Group operates Quinn Consultants, Quinn Lawyers, Quinn Financial Planning and Quinn Financial Solutions. The Quinn Group provides related information in regard to legal, accounting and financial planning issues. Liability limited by a scheme approved under Professional Standards Legislation* *other than for the acts or omissions of financial services licensees.