Undervalued boats cost importers almost $2 million

Companies importing vessels from overseas have been put on notice by the Australian Border Force (ABF) after demands for payments of nearly $2 million were issued for two undervalued commercial craft.

In the worst case, an investigation by ABF Customs Compliance officers discovered that a dredging vessel recently imported into Queensland was undervalued by more than $15 million.

At the conclusion of the investigation the value of the vessel was amended to just over AUD$65,840,000, which resulted in a demand for additional Goods and Services Tax (GST) of $1,564,281.80.

In the second case, ABF officers found that the broker for a tug boat imported to work in the Pilbara region of Western Australia had also incorrectly reported the value of the vessel by USD$1,734,200.

Based on the vessel’s amended value of just over USD$8.6 million, the broker was required to pay an additional AUD$250,000 in GST.

In an unrelated investigation also involving a vessel, the broker of a dredger imported into the Northern Territory was required to pay an additional $20,549 in Duty and GST for understating the amount of marine diesel fuel and lube oil it was carrying.

Imported fuel products are subject to an equivalent customs duty instead of excise duty unless they are used in excise manufacture (excluding biofuels).

ABF Acting Commander Steve Evans said the three cases served as a reminder for all Australian businesses of the requirement to correctly declare their imports.

“Importers who don’t pay the correct amount of duty and GST are depriving the Australian economy and ultimately Australian taxpayers,” Acting Commander Evans said.

“ABF Customs Compliance officers work diligently to ensure importers comply with reporting and revenue collection requirements so there’s a level playing field for both industry and consumers.

“Failure to comply can result in severe penalties, or the suspension or cancellation of licences and potentially prosecution.”

As Australia’s customs service, the ABF has made trade enforcement one of its key operational priorities.

Information to help businesses comply with their obligations is available at:

https://www.abf.gov.au/importing-exporting-and-manufacturing/trade-and-goods-compliance

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