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During August 2014 BR International sent out a news bulletin informing clients of the upcoming reduction in duty rates for textiles, clothing and footwear ( TCF ) products, effective from January 1st, 2015. With this key date nearing closer we feel it is timely to remind our TCF clients of the impact these reductions will have.
As per our previous bulletin, duty rates for TCF goods will be reduced, as the final part of the Australian Government’s long term phasing down of TCF duty rates, on 1 January 2015. The reduction will only affect those TCF products currently attracting a 10% duty rate and will be adjusted to 5%.
The reductions of duty rates apply to a range of textile fabrics and clothing, including knitted and woven coats, jumpers, shirts, under garments and other finished textile articles. As the reduced rates commence on 1 January 2015, it will only take effect for those Customs import declarations lodged on or after that date. This leaves numerous options for TCF importers to consider when deciding whether to delay shipments and subsequently incur the lower rate of Customs duty.
The most obvious option would be to delay movement of any affected consignments so that they do not arrive prior to January 1st, 2015. There are however alternate options which importers may like to consider, such as simply leaving shipments to incur storage until January 1st (when an import declaration can be lodged at the lower rates), provided the duty savings are greater than the storage amount accrued. Further to this, consignments may be moved “underbond” which is a Customs approved movement from the wharf or delivery terminal into a Customs approved warehouse where they can be stored until clearance on January 1st. Such movements are often more cost effective than simply leaving the freight where it arrives as storage charges can be excessive at the wharf or terminal.
BR International can assist with any option and are happy to accommodate any requests. Prior to making a decision it is recommended that affected importers weigh up costs involved as opposed to duty savings and consider all options.
For further information in relation to tariff headings affected or storage/movement costs which may be incurred we recommend making contact with your customer solutions representative.Back to News Page