According to The Conversation on Mar 10, the Australian government will abolish import tariffs on nearly 500 goods from Jul 1. The goods include toothbrushes, hand tools, refrigerators, dishwashers, apparels, and sanitary products. The current tariff rate for such products is 5%. The budget cost has not been disclosed, in part because the plan is still being negotiated.
The Australian government said this is the "largest unilateral tariff reform in 20 years" and praised its productivity improvements. The government said in a statement: "The new tariff measures will reduce compliance costs, reduce red tape, make doing business easier, and increase productivity." The statement also said that after signing a series of trade agreements, most goods are now imported duty-free. This means that companies need to spend time and money proving that their imported products qualify for existing tariff preferences and concessions, and they often pass compliance costs on to consumers.
The news said that the new tariff measures will abolish 14% of Australia's total tariffs, simplifying annual trade worth about AUD 8.5 billion. It is estimated that companies will save more than 30 million US dollars in compliance costs annually.
It is worth noting that this tariff reduction mainly targets the so-called "nuisance tariffs" on imports. The Australian Productivity Commission report in 2020 defined nuisance tariffs as tariffs that generate little revenue increase, provide minimal benefits to producers, but impose compliance burdens. The statement said that abolishing these tariffs would benefit businesses without adversely affecting Australian industry or limiting Australia's participation in sensitive free trade agreement negotiations. It is claimed that the administrative costs of imposing these tariffs amount to 11-20 million US dollars annually.
