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  • Russell Wiese

The Australian 2023 / 24 budget - A customs and trade perspective

The 2023 / 24 contained a number of issues relevant to importers, exporters and trade professionals covering topics such as free trade agreements, biosecurity funding and taxation of tobacco. Below we set out some key customs and trade announcements.


Over recent months there have been regular complaints that the Department of Agriculture Fisheries and Forestry does not have sufficient funding to perform its functions, including tasks related to the clearance of goods.

The response from the Government has been significant with $1.03 billion in additional funding promised in the budget over a number of years. There is a 25% increase in funding for the next financial year. with that raised level of funding locked in until 207/28. The bulk of the increased funding goes directly to maintaining biosecurity policy, operational and technical functions. This will include increased funding for frontline border operations and import clearances.

The increased funding will come a cost to importers. In particular, from 1 July 2024 a cost recovery charge will be imposed on low value goods ($1,000 or less) imported by air or sea. The charge will be $0.40 per consignment and will presumably be imposed on someone other than the importer, such as the carriers or cargo reporters. We expect that collection details will be shared over the coming months. This change is only expected to raise $27 million and I wonder how much the collection and compliance cost on industry will be. If the costs of collecting are not much greater than the revenue raised, the most likely outcome is that the charge will be increased in coming years.

Larger consignments will also be subject to increased fees in order to ensure that the level of cost recovery meets the actual costs associated with managing the associated risk. Importers already saw the charge on a full import sea declaration increase form $49 to $58 in January this year and more increased are expected from 1 July 2023 following a review of biosecurity cost recovery.

Undoubtably, the main concern of importers, forwarders and brokers will be that increased charges result in more timely clearance of goods.

While it will take time for the increased funding to result in tangible changes, the funding will not only be targeted at improving service levels, but also improving biosecurity compliance.

Free Trade Agreements

The biggest customs duty change was not a budget announcement, but the news that the UK FTA will commence on 31 May 2023. This will result in the immediate elimination of tariffs on almost all qualifying UK imports and significantly reduce duty on a range of Australian exports. The FTA will be user friendly with no requirement for an official certificate of origin, but rather traders can rely on a declaration of origin produced by the exporter or producer. There is no prescribed format for the document and it can be in electronic form. However, be careful to ensure that the minimum data requirements are met.

While there is good news about the UK FTA, the conclusion and implementation of an FTA with the EU seem some time away. The budget does not account for the associated reduction in customs duty that the EU FTA would bring until the 25 / 26 financial year. Hopefully, this is the Government being conservative and the EU FTA has a chance of being finalised and implemented in 2024.

The Government has not foreshadowed any other FTAs having a material impact on duty collections.

General reductions in customs duties

It is forecasted that there will be a significant reduction in customs duties collected on goods over the next 3 years. While duty on alcohol, fuel and tobacco will remain strong, customs duties on all other goods is expected to sharply fall. For instance, duty on vehicles is expected to fall from $420 million to $210 million and duty on “all other goods” is expected to fall from $1,530 million to $650 million.

This is the effect of free trade agreements and other concessions. The challenge for customs brokers is demonstrating to clients that:

· It is their skill that makes the reliable use of concessions possible;

· The value of customs brokers lies as much in the smooth clearance of goods and managing unexpected ABF or supply chain disruptions, as in the management of duties.

It will also be interesting to see where the ABF compliance priorities are directed in an economy where very little customs duty is paid. Already we have seen an increased focused on supply chain security, license conditions and dumping duty.

Continuing to simplify trade

The Government has continued to fund initiatives to modernise international trade. This includes delivering the simplified trade system reforms.

Unfortunately the level of funding is not suggestive of significant reforms. For instance, only $1.7 million has been allocated to the Department of Agriculture, Fisheries and Forestry. It is hard to see how biosecurity will figure strongly in any proposed single window system with only this level of funding.


The government will continue to use taxation to encourage less smoking in the community. In addition to ordinary indexation, excise equivalent tariffs will be raised by an additional 5% in each of the next three years. In addition, roll-your-own tobacco will be taxed the same as stick tobacco.

Illegal tobacco imports will continue to be a focus of the ABF. The Government has stated that it will expand compliance activity to address illicit tobacco and develop a multi-jurisdictional approach.

Customs brokers should increase their level of due diligence, particularly with new customers or where there are any red flags present.

What was missing

Unfortunately there is no specific funding to improve the administration of the anti-dumping system. This is an area that is significantly under resourced which results in a longer than necessary timeframes for carrying out investigations and reviews. Investigations regularly take over 12 months and this results in both unpredictability for traders and duty rates that are out of date as soon as they are implemented.

A lack of additional funding also means that reforms, such as a dumping duty ruling system, seem far off.

This is also one of the few budgets in recent memory that did not include any new tariff concessions or bylaws to achieve a policy objective. For instance, with the big push towards transforming Australia into a green energy leader, tariff concession for green technology goods or major green projects would have been welcomed.

It is also worth noting the items that were welcomely absent from the budget. Namely, the Government increased biosecurity funding but, after industry opposition, is no longer seeking to recover the funds from a per container biosecurity levy.


We regularly advise importer, exporters, customs brokers and freight forwarders on all regulatory aspects relating to the international trade in goods. Please do not hesitate to contact us at if you wish to discuss any of the above policy developments.

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