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INDEPENDENT DISTILLERS (AUST) PTY LTD -v- CEO OF CUSTOMS
Louis Gross & Associates recently won a case in the Administrative Appeals Tribunal (AAT) to confirm that Customs duty on RTD’s (Ready To Drink mixed drinks) was to be calculated on the actual alcoholic content and not the labelled content.
The importer brought into Australia cans of RTD’s (Ready to Drink mixed alcoholic drinks). The cans were labelled 5% alcohol content. The Food Standards Code provided a permissible .5% variation and the imported cans in fact contained 4.8% alcohol.
The question then arose as to whether Customs duty should be levied on the stated alcohol content of 5% or the actual alcohol content of 4.8%. Customs sought to try and rely s.136 of the Customs Act, which stated that where goods were reputed to be of a certain size or quantity greater than their actual size or quantity, then duty should be charged according to the reputed size or quantity.
It was argued however by Louis Gross on behalf of the importer that s.136 had no application to this case. This was because s.136 only applied to the actual volume of the quantity of liquid in the can and did not apply to the actual alcohol concentration. This argument was supported by a historical analysis of the legislation, including an amendment to the legislation dealing with the calculation of the volume of beer for duty purposes.
The AAT accepted these arguments on behalf of the importer and confirmed that s.136 was not applicable in this situation. The AAT also noted that if there was any misdescription on importation, then that should be dealt with under the Commerce Trade Descriptions Act.
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