Ian Macfarlane (Groom, Liberal Party, Shadow Minister for Trade) Share this | Link to this | Hansard source

The Tradex Scheme Amendment Bill 2008 is another piece of excellent legislation which, as the shadow minister for trade, I welcome the opportunity to speak on. The previous government was well and truly aware that exports are one of the most important features of Australia’s economy and are worth more than $216 billion a year. Trade continues to open up new opportunities for Australia—opportunities that create jobs, drive prosperity and help ensure the future of our nation. At least one in five Australian jobs are generated by exports and, more importantly, bearing in mind my rural and regional background, in rural and regional Australia this industry—that is, the export industry—is creating one in four jobs directly and indirectly.

The coalition are steadfast in our commitment to trade, trade reforms and liberalisation. Trade is central to our economy and, in government, we implemented a raft of policies to help exporters operate more effectively and efficiently. One of the most important of those was the Tradex Scheme. This came into effect from 2000 to provide duty relief for those items that are imported with the express purpose of being exported or used in some way for another product that is in turn exported. The Tradex Scheme has been connected to the duty drawback regulations and, while the former provides upfront duty exemption for imported goods destined for export, the latter provides for the return of duties paid on imported goods when they are subsequently exported.

The Tradex Scheme Amendment Bill 2008 will provide a simpler framework for trade by decoupling the Tradex and drawback programs. Decoupling the Tradex and drawback regulations will enable the Tradex Scheme to remain consistent with the Customs drawback provisions without being dependent on them. By separating these two programs, importers and exporters will be further assisted as it will allow the two operations to be tailored to meet the particular demands of its customer base. It is essential that we provide exporters with the right framework in which they can operate in a way that will encourage value adding, innovation and of course competitiveness. Trade brings out the best in businesses. While the global marketplace is highly competitive, it is also a rich reservoir of opportunity for Australian businesses and industry. By exporting, Australia’s businesses access a global marketplace of more than six billion consumers. By participating in the global marketplace, Australian businesses are more likely to be innovative, to enhance their productivity and to integrate into global supply chains and areas that are so important in terms of our future industry growth.

Trade brings down the costs for businesses and consumers. The competition encouraged by exports provides businesses with high-quality supplies they need at prices that keep them competitive at home and overseas. By exporting, businesses can achieve cost savings through higher production volumes. That is crucially important in many of the industries which are now facing pressure from imports. Their solution will come from exporting their products into global supply chains and global markets. Export to world markets many times larger than the domestic markets will provide opportunities which in many cases will be the difference between survival and failure for many of Australia’s industries and businesses.

The benefits exporters receive from their exposure to international trends in technology, product design and consumer behaviour will also spill over into the Australian economy. There is no better example than that of the car industry, in which we now see two of Australia’s leading manufacturers, GMH and Toyota, exporting half of their production overseas. Thus they are sustaining a very viable future for themselves and for the industry and utilising the opportunity to export Australian technology while at the same time importing technology here which is then incorporated into our general production.

The other elements of this bill will enhance the administration of the Tradex Scheme and will cut through the red tape for the industry—something I understand the minister is very fond of, and I wish him every success in that regard. It is an area which we have all in our time battled, and an area in which the previous government had some success, but that does not mean that there is not ample room for further success. Not only will we be cutting through red tape for industry but, more importantly, we will be improving our competitiveness as an exporting nation. These amendments are worthy of the coalition’s support and I commend them to the chamber.

Craig Emerson (Rankin, Australian Labor Party, Minister Assisting the Finance Minister on Deregulation) Share this | Link to this | Hansard source

In closing, I would like to thank the member for Groom for his contribution to this debate on the Tradex Scheme Amendment Bill 2008. This bill will decouple the Tradex Scheme from the requirements of the Customs drawback provisions and will simplify the administration of the scheme. Tradex and drawback are designed to ensure that customs tariffs are not paid on goods that are imported and subsequently exported, and that they are not inappropriately used or consumed while in Australia.

Both programs are based on the international taxation principle that taxes should apply in the country in which the good is consumed. However, there are subtle differences in the way in which Tradex and drawback operate. The separation of the legislation for the two programs will enable each program to be better tailored to meet the particular demands of its customer base. Administrative simplification of Tradex should further reduce the regulatory burden on industry that uses the scheme. As the member for Groom points out, I have always been keen on reducing unnecessary red tape and in my current capacity as Minister assisting the Finance Minister on Deregulation I take on that task with great vigour and enthusiasm.

Tradex was introduced as a streamlined program for providing relief to businesses paying customs duty and GST. This bill will further improve a program that provides more than $200 million per annum of up-front tariff duty and GST relief to industry importing and exporting in competitive global markets. It provides real benefits to Australia’s exporters and improves our international competitiveness as a trading nation. It is pleasing to see the coalition’s support for this bill. I commend the bill to the chamber.

Question agreed to.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.

Ordered that this bill be reported to the House without amendment.