Joe Ludwig (Queensland, Australian Labor Party, Manager of Opposition Business in the Senate) Share this | Hansard source

by leave—As there is nothing more in that area that I can usefully explore, given the time available, I move opposition amendments (1) and (2) on sheet 5175:

(1)    Schedule 5, item 2, page 12 (line 12), omit “15th”, substitute “7th”.

(2)    Schedule 5, item 6, page 13 (lines 1 and 2), omit “accredited client monthly duty estimate,”.

Obviously, not everyone listening can see the explanatory memorandum for the Customs Legislation Amendment (Border Compliance and Other Measures) Bill 2006, but if they could they would look in horror at a map which provides for how the accredited client payment structure will in fact work. Attachment A gives a good indication of the confusing way in which industry will have to use the accredited client payment structure. On the 15th of the first month, you can lodge your RCR for each shipment—that is, the payment covering estimated duty of all imports for month 1. Then we move to the second month, when you can lodge your RCR for each shipment—so you can continue to do that work—and, when the 7th turns up, you can lodge your periodic declaration for month 1. So in the next month you lodge your periodic declaration. Then on the 15th—a short time later in that same month—you can reconcile payment of the estimate from month 1, plus or minus, as the case may be, payment of fees for the RCR and payment of fees for periodic declaration and then a payment covering estimated duty for all imports for month 2. By the time that business has got to month 3, they can continue to lodge their RCR for each shipment, and again on the 7th they lodge the periodic declaration for month 2. Then on the 15th they lodge the reconciliation payment estimate for month 2, plus or minus, and the payment of fees for the RCR, the payment of fees for periodic declaration and then a payment covering estimated duty for all imports for month 3. And so it goes on.

If that sounded confusing, it is. There is a simpler system and it is a duty deferral system. If the government is not prepared to provide for it, that is what these amendments seek to do. What this will mean for industry is that they will have a number of transactions, but those transactions will mean that they will have to not only lodge the RCR and then work out an estimate in the first month—so halfway through the month they have to provide at least a best guess of what the payments are going to be for the period from the 15th to the end of the month and pay that, so they have to make an up-front payment—but also in the next month continue their lodgement, as they would do. On the 7th they would lodge their declaration for month 1, because of course then they would have at least an idea of what it was, and then on the 15th, a short time later, they have to do a reconciliation to work out whether Customs owes them money or they owe Customs money. This would continue for each month.

I do not know of too many systems in business that use these types of systems that provide for guesstimates. It might be easy for some businesses—they could automate it and they could find that it may or may not work—but it would depend a lot on your seasonal variation, your high and low time and your historical data to be able to guesstimate, because the last thing you want to do is pay money that might be more than you need to pay at any particular time, because then it is not in your hands but in Customs’ hands. Of course, you then have to go through a reconciliation process with Customs, which may in fact be a simple process or sometimes it may be a little bit more complex. Looking at the system that they now have, I cannot see why you could not adopt a much simpler process. It would have been more beneficial to all if Customs and the minister had worked towards a simplified system rather than creating what can only be described as more red tape for industry—more processes and more transactions—which will, more likely, add to their cost structure. Of course, the short answer might be that it will all be automated and businesses will get used to it. I guess they do not have much choice in that instance but to get used to it, if they want their imports and exports dealt with. When you are dealing with a monopoly, I do not know whether that is a fair reply.

Hopefully the minister can support these amendments. I foreshadow that I will move amendments (3) and (4) but I will not talk to them now. They go to the same issue of creating a simpler duty deferral system, which the minister should have looked at in the first instance in order to try and ensure that result for business. Certainly, when business is operating in the usual way, there is usually provision of bills and a payment of those. Quite frankly, I admire the person who came up with such a strange system. It certainly took a bit of forethought to come up with a system whereby, halfway through the month, you have to guess what you will import and pay for it accordingly, when you do not know what it is. It might be on a ship yet to arrive here or it might not be. It might not have left the port if the port is not that far away. But, in any event, that is the system business is now going to have to work with. I do not agree with it and these amendments will seek to fix it.