Australia: Legislative proposal to clarify tariff classification of vitamins, nutraceuticals, food supplements

Australia: Proposal to clarify tariff classification

Importers of food supplements and similar products need to consider implications of proposed legislation to determine the status of their claimed tariff classification.

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The legislation proposes to clarify the tariff classification of vitamin products, nutraceuticals, and food supplements. The introduction of the “Customs Tariff Amendment (Incorporation of Proposals and Other Measures) Bill 2020” follows recent decisions made in the Administrative Appeals Tribunal (AAT), Federal Court, and High Court. If enacted, the legislation would treat these products as dutiable as food supplements (unless they are imported from a free trade partner, and eligible for free trade agreement preferential duties).

The bill would introduce additional notes to the relevant chapters of the Customs Tariff Act 1995, the outcome of which is:

…unless the goods are goods to which Schedule 2, 3, 4 or 8 to the current Poisons Standard (within the meaning of the Therapeutic Goods Act 1989… they will be classified as other food products at a general duty rate of 4 percent.

The relevant Schedules in the Poisons Standard are as follows:

Schedule 2

 

Pharmacy Medicine – Substances, the safe use of which may require advice from a pharmacist and which should be available from a pharmacy or, when a pharmacy service is not available, from a licensed person.

Schedule 3

 

Pharmacist Only Medicine – Substances, the safe use of which requires professional advice but which should be available to the public from a pharmacist without a prescription.

Schedule 4

Prescription Only Medicine, or Prescription Animal Remedy – Substances, the use or supply of which should be by or on the order of persons permitted by State or Territory legislation to prescribe and should be available from a pharmacist on prescription.

Schedule 8

Controlled Drug – Substances which should be available for use but require restriction of manufacture, supply, distribution, possession and use to reduce abuse, misuse and physical or psychological dependence.


If enacted, the legislation would be effective 28 days from the date of Royal Assent.


For more information, contact a KPMG trade professional in Australia:

Leonie Ferretter | +61 2 9455 9330 | lferretter@kpmg.com.au
 

For more information on this topic or to learn more about KPMG’s Trade & Customs Services, contact:

Doug Zuvich
Partner and Global Practice Leader
T: 312-665-1022
E: dzuvich@kpmg.com

John L. McLoughlin
Principal and East Coast Leader
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E: jlmcloughlin@kpmg.com

Andy Siciliano
Partner and National Practice Leader
T: 631-425-6057
E: asiciliano@kpmg.com

Steve Brotherton
Principal and Global Export and Sanctions Leader
T: 415-963-7861
E: sbrotherton@kpmg.com

Luis (Lou) Abad
Principal, Washington National Tax
T: 212-954-3094
E: labad@kpmg.com

Irina Vaysfeld
Principal
T: 212-872-2973
E: ivaysfeld@kpmg.com

Amie Ahanchian
Principal
T: 202-533-3247
E: aahanchian@kpmg.com

Christopher Young
Principal
T: 312-665-3229
E: christopheryoung@kpmg.com

Gisele Belotto
Managing Director
T: 305-913-2779
E: gbelotto@kpmg.com

George Zaharatos
Principal
T: 404-222-3292
E: gzaharatos@kpmg.com

Andy Doornaert
Managing Director
T: 313-230-3080
E: adoornaert@kpmg.com

Jessica Libby
Managing Director
T: 612-305-5533
E: jlibby@kpmg.com

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