CUSTOMS (AMENDMENT) BILL

Order for Second Reading read.

The Minister for Finance (Dr Richard Hu Tsu Tau): Mr Deputy Speaker, Sir, I beg to move, "That the Bill be now read a Second time."

This Bill seeks to amend the Customs Act to give legislative effect to a change of definition of customs duty to exclude excise duty. It also incorporates three other amendments to the Customs Act.

Re-definition of Customs Duty

Currently, our Customs Act defines customs duty as `any import or excise duty imposed by or under this Act'. The common international practice is that customs duty refers exclusively to tariffs applied on imported goods for protective and other trade policy purposes. Our current definition of customs duty may therefore cause confusion to our trading partners since it also includes excise duty which is applied in a non-discriminatory manner on imported goods and locally manufactured products for fiscal and other domestic policy purposes.

To make clear to our trading partners the respective purposes of our customs duty and excise duty, our definition of customs duty should be amended to exclude excise duty. In this connection, a new subsection 10(1A) will also be inserted to state clearly that excise duty shall be imposed in a non-discriminatory basis regardless of the place of origin or manufacture of the goods. For equal treatment of imported goods and locally manufactured goods, section 22 will also be amended so that the same basis of valuation will be applied on imported goods and locally manufactured goods for the purposes of levying excise duty.

Other Changes to the Act

In addition to the aforementioned amendments, the following amendments will also be made to the Customs Act.

Currently, all sellers of liquors must apply for a licence. A new subsection 71(3A) would be inserted to empower the Minister to exempt any person from having to apply for a licence for the sale of liquors subject to conditions imposed by the Minister. This amendment will allow individuals who sell small quantities of liquors to be exempted from applying for a licence. An example would be a person who wants to auction a few bottles of his personal collection of wine through the Internet. We have decided to cap the sales limit at 9 litres per calendar year.

Section 75 provides for specific duties and requirements to be imposed on persons licensed for the sale of intoxicating liquors. This section will be repealed. The new section 75 will enable the Minister to prescribe by regulations certain duties and requirements of persons licensed to sell liquors. This will give us the flexibility to revise those duties and requirements to keep up with changing circumstances without having to amend the Act.

Lastly, a new section 90E will be inserted to require every importer and exporter of dutiable goods and his agents to retain specified documents relating to the goods for not less than seven years. This new section will facilitate the enforcement of other provisions of the Act.

Sir, I beg to move.

Question put, and agreed to.

Bill accordingly read a Second time and committed to a Committee of the whole House.

The House immediately resolved itself into a Committee on the Bill. - [Dr Richard Hu Tsu Tau].

Bill considered in Committee; reported without amendment; read a Third time and passed.