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Customs Tariff Amendment Bill (No. 2) 2001

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1998-1999-2000-2001

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

SENATE

 

 

 

excise tariff amendment bill ( No . 1) 2001

CUSTOMS TARIFF AMENDMENT BILL ( No . 2) 2001

 

 

SUPPLEMENTARY EXPLANATORY MEMORANDUM

 

Request for amendments to be moved on behalf of the Government

 

 

 

(Circulated by authority of the

Treasurer, the Hon Peter Costello, MP)

 



Excise Tariff Amendment Bill (No. 1) 2001 and Customs Tariff Amendment Bill (No. 2) 2001

The amendments to this legislation will incorporate further alterations to the Excise Tariff Act 1921 (the Excise Tariff Act) and the Customs Tariff Act 1995 (the Customs Tariff Act) to reduce the rates of excise and customs duty on certain beer packaged in an individual container exceeding 48 litres. This will give effect to the Government’s decision to reduce the price of draught beer.

Duty rates for certain beer

The amendments to these Bills will incorporate further alterations to the Excise Tariff Act and Customs Tariff Act to:

·       reduce excise and customs duty rates for beer packaged in an individual container exceeding 48 litres;

·       align the reduced rates with the present Excise and Customs Tariff structures by providing 3 different duty rates based on alcohol content - that is, for low strength, mid strength and full strength beer; and

·       provide for beer of these differing alcoholic strengths that is packaged in an individual container of 48 litres or less by applying the rates of duty introduced on 1 July 2000 that have since been subject to indexation increases in August 2000 and February 2001.

Date of effect :  The alterations to the Excise Tariff Act and Customs Tariff Act were proposed by Excise Tariff Proposal No. 4 (2001), and Customs Tariff Proposal No. 3 (2001), and tabled in Parliament on 3 April 2001. The amendments took effect on and from 4 April 2001.

Proposal announced :  Prime Minister’s Media Release No. 914 of 3 April 2001.

Financial impact :  The reduction in rates of duty for draught beer is estimated to cost $35 million in 2000-2001. The amount of $120 million, equivalent to the difference between collections on draught beer since 1 July 2000 and the amount that would have been collected using the new rates (with the exception of the following), will be appropriated and allocated to an independent foundation to be called the ‘Alcohol Education and Rehabilitation Foundation’. A small portion of this amount will be allocated to an initiative for the restoration and preservation of historic hotels in rural and regional Australia. Costs for the outyears are estimated at $175 million in 2001-2002, $180 million in 2002-2003, $180 million in 2003-2004 and $185 million in 2004-2005.

Compliance cost impact :  The impact of the change in the duty rates for beer on the major brewers is expected to be minor, as these clients already have in place systems and procedures for dealing with Tariff changes with minimal effort. For the smaller clients (around 50), no impact is expected as they use manual systems.

 



C hapter

Duty rates for certain beer

Excise tariff amendment bill ( No . 1) 2001

Outline of chapter

1.1         Schedule 1, Part 6, item 18 will amend Excise Tariff subitem 1(C) of the Schedule to the Excise Tariff Act to provide for reduced rates of duty on certain beer.

Context of reform

1.2         The Prime Minister announced in a Media Release of 3 April 2001 that the Government will introduce tariff proposals to change the rates of excise and customs duty on draught beer with effect from 4 April 2001.

1.3         This amendment is identical to, and ratifies, the Excise Tariff proposal that gives effect to the Prime Minister’s announcement.

Summary of new law

1.4         Excise Tariff subitem 1(C) of the Schedule to the Excise Tariff Act will be repealed and substituted with new subitem paragraphs and rates of excise duty for beer packaged in an individual container of 48 litres or less, and beer packaged in an individual container exceeding 48 litres.

Detailed explanation of new law

1.5                   The Schedule to the Excise Tariff Act will be altered by repealing subitem 1(C) and substituting the subitem 1(C) with 2 new paragraphs and tiers of rates as follows:

·        beer packaged in an individual container not exceeding 48 litres, with the rates of duty based on alcohol content (i.e. for low strength, mid strength and full strength beer) introduced on 1 July 2000 that have since been subject to indexation increases in August 2000 and February 2001; and

·        beer packaged in an individual container exceeding 48 litres, with 3 rates of duty for the differing alcoholic content of low, mid and full strength.

1.6         The substituted subitem and rates will take effect on and from 4 April 2001.

CUSTOMS tariff amendment bill ( No . 2) 2001

Outline of chapter

1.7         Part 4 of the Schedule amends tariff subheadings 2203.00.8 and 2206.00.7 to provide for reduced rates of customs duty on certain beer.

Context of reform

1.8         The Prime Minister announced in a Press Release of 3 April 2001 that the Government will introduce tariff proposals to change the rates of excise and customs duty on draught beer with effect from 4 April 2001.

1.9         This amendment is identical to, and ratifies, the Customs Tariff proposal that gives effect to the Prime Minister’s announcement.

Summary of new law

1.10       Customs Tariff subheadings will be repealed and substituted with new subheadings and rates of customs duty for beer packaged in an individual container of 48 litres or less, and beer packaged in an individual container exceeding 48 litres.

Detailed explanation of new law

1.11               Item 23 of Part 4 of the Schedule amends the table to section 19(1) of the Customs Tariff Act to reflect the new paired tariff subheadings and excise items.  Section 19 allows the customs rates of duty to be automatically adjusted in line with movements in the Consumer Price Index, which are reflected in the excise rates of duty for similar goods.

1.12               Items 24 and 25 of Part 4 of the Schedule amend the Customs Tariff to separately identify beer in an individual container exceeding 48 litres and to apply the reduced rates of duty based on alcohol content (i.e. for low strength, mid strength and full strength beer).

1.13               Beer packaged in an individual container not exceeding 48 litres, retains the rates of duty introduced on 1 July 2000 that have been subject to indexation increases in August and February 2001.

1.14               The new tariff subheadings and rates took effect on and from 4 April 2001.