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Overview of the Rules and Regulations of Commercial Imports into Australia

Thursday, 29th January 2015

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Generally speaking, Australia is a great place for importers. Regulations are straightforward, and it is clear what restrictions exist on what can and can’t be imported. There are the usual bevy of taxes and fees to navigate through when importing into Australia, but there is no requirement for importers to hold a specific import license. Once you’ve cleared through Customs control, then your goods are ready to sell in the local market.

If you’re looking to start importing goods from overseas, the first thing to check is whether the goods that you’re looking to import are on the listed of restricted or prohibited goods. Australian Customs and Border Control maintains a helpful online list that outlines all goods that fall under these categories, as well as the details of the group to contact if you’re looking to import a restricted good - they can be reached here.

There are also a raft of restrictions affecting the import of foodstuffs. All food imported into the country must comply with Australia’s biosecurity laws, and there is a comprehensive database on the Department of Agriculture’s website that you can use to help determine whether the specific food that you’re looking to import into the country is the subject of restrictions or not.

It is also important to note that all labels on imported goods (especially foodstuffs, but it applies to other categories too) need to be in clear, legible, and accurate English. It is an offense to import goods that have a label that is incorrect and misleading. Labels might include information such as size, weight, quality, quantity, origin, manufacturer, ingredients and copyright notices.

Understanding taxes and duties

There are a number of fees and taxes that are due when importing goods into Australia. The first thing worth noting is that, unlike some other countries, Australia operates under a ‘Free on Board’ or FOB concept. FOB means that the duties payable are calculated on the value of the goods being imported only, and not the costs of shipping and insurance. Here are some other things worthy of note:

  • The minimum FOB of the goods being imported needs to exceed $1,000 for duty and other fees to kick in. Under that value and there is no cost for you
  • If the FOB value of the goods exceeds $1,000, then duty rates can vary from nothing (for electronic goods such as laptops, for example), up to around 10%
  • In addition, you’ll need to pay a goods and services tax (GST) for most imported goods. Some foodstuffs (mostly fresh food) are exempt, along with some medical aids, but for the rest, GST is 10% of the Value of Taxable Importation (VoTI). The VoTI is calculated at the sum of both the value of the goods, the duty payable, and the cost of freight and insurance. Additionally, there is a Wine Equalisation Tax that applies a 29% levy when importing wines and other alcoholic beverages
  • If the total value of the goods is higher than $1,000, there is an import processing charge, which varies depending on the way in which the declaration is made. The charge can range from $40.20 to $65.75
  • When the value of goods exceeds $10,000, the import processing charge is higher, ranging from $122.10 to $152.60
  • Finally, there is a tax for luxury cars. If you’re importing expensive cars then there is a 33% levy on those as well

Final recommendations

It is strongly advised that you set yourself up with an Australian Business Number (ABN) and register for GST purposes when setting up an import business into Australia, so that you can claim input tax credits or access the GST deferral scheme.

It is also worth noting that Australia has numerous free trade agreements, and when importing goods produced in these countries there are no payable tariffs, import quotas, or preferences on most, if not all goods. These countries include New Zealand, United States, Thailand, Singapore, Malaysia, South Korea, Japan, Chile, and Canada. For full details on the effect that the free trade agreement has on the goods you’re looking to import, you can read more on the Customs website.

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