Department of Home Affairs (Home Affairs)

A80

Home Affairs assesses the GST liability on all taxable importations of goods imported via Australian ports and airports, mail imported through all Australian international mail centres and goods entering Australia with passengers and crew via all Australian ports and airports. This amount includes deferred import amounts which are accounted for on the BAS.

A81

The GST liability assessed by Home Affairs on taxable importations is deferred (and accounted for on the BAS under the deferred imports scheme) for cargo importers that have been approved by the ATO for GST deferral. In all other cases, Home Affairs collects the GST.

A82

This is the dollar amount of total TRS claims paid in a specified financial year.

A83

This figure is calculated as:

Cost of import and export compliance + Costs of TRS compliance

A84

Home Affairs import and export compliance includes:

• intelligence and risk assessment (including associated research, analysis and monitoring)
• pre- and post-clearance interventions (pre-clearance interventions, including real-time verification of import declarations, occur before the release of goods from Customs control, and post-clearance interventions, including formal audits, occur after the release of goods from Customs control)
• enforcement (including investigation, imposition of sanctions and prosecutions)
• education and advice (including tariff, valuation and origin advice).

Note: Home Affairs captures all TRS costs as a single figure, comprising administration, processing and compliance.

A85

TRS coverage is defined as the proportion of TRS claims subject to compliance activity. Compliance coverage for TRS is calculated as:

Number of TRS claims subject to compliance activity ÷ Number of TRS claims lodged × 100

A86

The TRS regulations require TRS claimants to present any or all of the goods, the tax invoice relating to the goods and certain travel documents to a Home Affairs officer on request. Home Affairs undertakes checks before payment of a refund is authorised.

A87

TRS compliance activities include real-time activities undertaken to verify that particular TRS claims meet the requirements of the regulations and any post-transaction compliance activities.

A88

This is a measure of the proportion of TRS claims that are rejected because the claim does not meet one or more of the requirements of the regulations. TRS claims rejected is calculated as:

Number of TRS claims rejected ÷ Number of TRS claims lodged × 100

A89

GST revenue is underpaid in cases where the GST liability assessed by an importer for a taxable importation is less than the correct GST liability (regardless of whether the GST liability was initially paid to Home Affairs or deferred for payment on the BAS). A GST underpayment adjustment occurs when the importer’s incorrect assessment is amended to correct the error, resulting in an increase in the assessed GST liability.

A90

Underpaid GST revenue includes additional GST revenue paid to Home Affairs (or deferred to the next BAS) in cases where an import declaration has been amended by an importer. It can refer to additional GST revenue paid to Home Affairs (or deferred to the next BAS) in relation to notices of assessment or other compliance activity.

A91

A GST assessment error could be the result of incorrect assessment of the value of the taxable importation or incorrect classification as a non-taxable importation.

A92

An incorrect assessment of the value of a taxable importation could result from an error in assessing the customs value, the customs duty, the wine equalisation tax or the amount paid or payable to transport the goods to Australia and to insure the goods for that transport.

A93

An incorrect classification as a non-taxable importation could result from an error in identifying the taxable status of particular goods.

A94

International travellers can obtain a GST refund under the TRS provided that they submit a claim that fulfils all of the requirements set out in the regulations.

A95

Where a TRS claim is checked and found not to comply with the regulations, the claim is rejected. This results in an adjustment of the GST refund claim down to zero. The value of the GST adjustment is equal to the amount of GST refund that was originally claimed. Certain rejected claims, (for example, not a valid tax invoice) are able to be reviewed by the Tourist Refund Office. If the review results in the claim subsequently being approved, a GST adjustment would need to be made.

A96

This measure is the sum of the GST adjustments that result from underpaid GST revenue, over-claimed GST refunds and rejected TRS claims.

Total GST adjustments = GST adjustments (underpaid GST revenue) + Rejected TRS claims

A97

Home Affairs also refuses and adjusts GST refund claims lodged by importers to correct overpayments. Data on these GST adjustments is not currently available.

A98

This measure is the costs attributed to the GST element of Home Affairs’ import-processing function.

A99

This function covers the processing of import transactions and associated revenue functions including establishing the liability for GST, wine equalisation tax and luxury car tax. Included under this function are the recording of amounts of deferred GST and the provision of import data to the ATO (including GST deferred data). Also included under this function is the processing and payment of claims for refund of GST, wine equalisation tax and luxury car tax.

A100

This function is carried out in relation to:

• all goods imported via Australian ports and airports
• mail imported through all Australian international mail centres, and
• goods entering Australia with passengers and crew via all Australian ports and airports.

A101

This measure is the costs attributed to the GST element of Home Affairs’ export-processing function.

A102

This function covers the processing of export transactions including collecting export data and providing it to the ATO.

A103

This measure is the costs attributed to the GST element of Home Affairs’ import and export compliance functions.

A104

This function covers compliance activities in relation to self-assessed declarations made by importers. It also covers compliance activities in relation to refund claims that relate to taxable importations.

A105

The costs of compliance activities in relation to the TRS are included in item 12(d) below.

A106

Home Affairs utilises a range of monitoring, response and enforcement compliance activities that are proportional to client behaviour and consistent with Home Affairs’ regulatory framework.

A107

This is a measure of the costs attributed to the administration of the TRS.

A108

This function covers the processing and payment of TRS claims and associated compliance activities. This function is carried out in relation to passengers departing from all international airports and seaports in Australia.

A109

This measure is the sum of the costs associated with carrying out Home Affairs’ 4 GST functions.

A110

Owners of imported goods are required by section 68 of the Customs Act 1901 to make a declaration to Home Affairs in relation to each imported consignment. Owners who make an import declaration are making a taxable importation (section 13-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)). A Home Affairs officer may refuse to deliver the goods concerned unless the GST has been paid [GST Act subsection 13-15(2)].

A111

An import declaration includes all of the information that is required to assess the GST liability.

A112

Owners of goods intended for export that have a Free On Board (FOB) value greater than $2,000 are required by section 113 of the Customs Act 1901 to make a declaration to Home Affairs in relation to each export consignment.

A113

Home Affairs provides the ATO with a monthly export data report. The ATO uses this information in undertaking compliance functions in relation to item G2 on the BAS.

A114

International travellers can obtain a GST refund under the TRS provided they submit a claim to Home Affairs that fulfils all of the requirements set out in the regulations.

A115

Home Affairs assesses the GST liability on all taxable importations. The GST liability assessed by Home Affairs on taxable importations is deferred (and accounted for on the BAS) for importers who have been approved by the ATO for GST deferral. In all other cases, Home Affairs collects the GST.

A116

Home Affairs processes all taxable importations regardless of whether the GST is paid to Home Affairs or deferred for payment on the BAS. It is appropriate, therefore, to compare processing costs to the GST liability assessed rather than to compare those costs to the GST collected by Home Affairs.

A117

This item could be misleading because it compares the processing costs to a small portion of Home Affairs taxable importation workload. This item needs to be considered in the context of item (i) Total costs as a percentage of total GST liability assessed.

A118

This measure reflects the ratio between the Total GST adjustments and the funding provided for compliance. This measure is calculated as:

Total GST adjustments ÷ Active compliance costs