On Friday, 25 October 2024, Freight & Trade Alliance (FTA) and the Australian Peak Shippers Association (APSA) engaged in discussions with executives from the New Zealand Customs Service and the Ministry for Primary Industries.
The focus was on the proposed changes to make goods fees and levies financially sustainable and fairer.
Following this meeting, and informed by feedback from our members, we have submitted a formal response to these proposed changes. Below is a summary of the FTA/APSA submission
- While justification for the proposed model is on 'Activity Based Costing', FTA is of the view that any charging regime should be commensurate with the specific risk generated by importing parties.
- The quantum of both the proposed import and export charges is exorbitant.
- By way of an international benchmark, the Australian Border Force does not charge any cost recovery on low value goods. The Department of Agriculture, Fisheries and Forestry charges 36 cents on low value goods (per consignment across both air and sea).
- This impost of the New Zealand model will generate significant costs for cargo reporters with these likely to cascade down the supply chain to cover associated administration of the regime. This will add to inflationary pressures ultimately borne by consumers.
- It is unclear why low value exports by mail is exempt a cost recovery charge. This provides a competitive imbalance against commercial operators.
- By way of an international benchmark, regardless of the mode of transport, neither the Australian Border Force or Department of Agriculture, Fisheries and Forestry charge on low value exports.
- The proposed export low value charge is another financial impost on New Zealand small to medium size businesses, impacting the commercial viability of reaching international markets via e-commerce marketplaces.
- Rather than a 'one size fits all' model as proposed, highly compliant importers, exporters and service providers should be incentivised with a differential (lower) cost recovery impost.
- Until an environment exists whereby charging is administered on a risk and resource utilisation basis, low value goods imported and exported by mail should attract at least the same cost recovery rate as the low value by air.
FTA looks forward to ongoing engagement with the New Zealand Customs Service and the Ministry for Primary Industries in the implementation of the proposed cost recovery arrangements and ongoing reform of statutory reporting to better address risk and facilitation of e-commerce trade.
In the interim, we request FTA representation on the formal industry consultative forum to be established to provide transparency on cost recovery results and to make a positive contribution via this forum to ongoing reform.