Customs Tariff Amendment (Incorporation of Proposals) Bill (No. 1) 2026: Nuisance tariffs abolished, Russia duties extended, Ukraine relief continued

The short answer

Customs Tariff Amendment (Incorporation of Proposals) Bill (No. 1) 2026: Nuisance tariffs abolished, Russia duties extended, Ukraine relief continued

The Customs Tariff Amendment (Incorporation of Proposals) Bill (No. 1) 2026 is a government bill introduced in the House of Representatives on 27 May 2026 and now passed both Houses of Parliament on 20 August 2026. It would amend the Customs Tariff Act 1995 in four parts: setting the general rate of customs duty to 'Free' for approximately 500 tariff headings (abolishing 'nuisance tariffs'); extending the 35% additional duty on Russian and Belarusian goods for a further 24 months to October 2027; continuing the free rate for Ukrainian goods for a further 24 months to July 2028; and repealing spent phasing rates for Peruvian originating goods. The bill gives legislative effect to three Customs Tariff Proposals tabled in Parliament in 2025 and 2026. Portfolio: Home Affairs.

This is a federal system guide. State constitutions, parliaments and local-government laws can allocate comparable functions differently.

The useful question is not only “what is the rule?” but also “who administers it, which document controls it, and when might it change?” That distinction prevents an accurate general explanation from becoming wrong advice in a particular election, chamber or policy setting.

Evidence review

What the bill proposes: four parts

The Customs Tariff Amendment (Incorporation of Proposals) Bill (No. 1) 2026 (Bill No. 66/26) was introduced in the House of Representatives on 27 May 2026. It is a government bill under the Home Affairs portfolio and is now before the Senate.

The bill has four distinct parts: Part 1 abolishes 'nuisance tariffs' by setting the general customs duty rate on approximately 500 tariff headings to 'Free', and ensures RCEP preferential rates are not higher than the general rate. Part 2 extends the additional 35% duty on Russian and Belarusian goods for a further 24 months to 24 October 2027. Part 3 extends the free rate for Ukrainian goods for a further 24 months to 3 July 2028. Part 4 repeals spent phasing rates for Peruvian originating goods which have already reduced to 'Free' as of January 2023.

The bill incorporates three separate Customs Tariff Proposals tabled in 2025 and 2026. Under the Customs Tariff Act, proposals have immediate provisional effect but must be confirmed by legislation within a specified period or they lapse.

Evidence review

Part 1: Abolishing nuisance tariffs

The bill proposes to set the general rate of customs duty to 'Free' for approximately 500 tariff headings and subheadings. The general rate for these items is currently 5%. However, the EM notes that 'due to the near universal use of applicable tariff concessions and free trade agreement preferential rates of customs duty, very few importers pay the general rate of customs duty.'

These are called 'nuisance tariffs' because they generate negligible revenue — most importers use concessions or FTA preferences to avoid paying them — but impose compliance costs. Businesses must complete paperwork to claim concessions or preferences that they almost always receive. Permanently setting the rate to 'Free' means 'all importers can access the Free rate of customs duty without incurring the compliance costs associated with tariff concessions and free trade agreement preferential rates', according to the EM.

This is a deregulatory measure aimed at reducing red tape for Australian businesses that import goods in the affected categories. The EM does not provide a list of the specific 500 tariff headings in the summary, but they are set out in Schedule 1 to the bill.

Evidence review

Part 2: Russia and Belarus duties extended to October 2027

Australia imposed an additional 35% customs duty on goods that are the produce or manufacture of Russia or Belarus in 2022, following Russia's invasion of Ukraine. This additional duty is applied on top of the general rate that would ordinarily apply. The bill extends the operation of this measure for a further 24 months, from 25 October 2025 to 24 October 2027.

The EM notes a limited exception: goods that are eligible for certain tariff concessions or that were left for direct shipment to Australia prior to 25 April 2022 are not subject to the additional duty. The financial impact is described as 'a negligible increase in customs duty receipts over the three years' of the forward estimates, which is consistent with the fact that trade with Russia and Belarus has already fallen dramatically since the initial imposition of sanctions.

This extension was originally announced through Customs Tariff Proposal (No. 2) 2025, tabled in Parliament on 28 August 2025. The bill gives legislative permanence to that proposal.

Evidence review

Part 3: Ukraine duty relief extended to July 2028

In a reciprocal humanitarian trade measure, Australia has applied a 'Free' rate of customs duty to goods that are the produce or manufacture of Ukraine. The bill extends this relief for a further 24 months, from 4 July 2026 to 3 July 2028. For goods classified under certain chapters of the tariff (covering beverages, tobacco, mineral fuels, organic chemicals and miscellaneous chemical products), a reduced rate rather than a full 'Free' rate applies.

This measure was given provisional effect by Customs Tariff Proposal (No. 2) 2026, moved in Parliament on 14 May 2026 and effective from 4 July 2026. The bill confirms that provisional measure in permanent legislation. Together with the Russia and Belarus provisions, it demonstrates Australia's continued use of the tariff system as an instrument of foreign policy.

Evidence review

Part 4: Cleaning up spent Peru FTA provisions

The Peru-Australia Free Trade Agreement entered into force in February 2020. By January 2023, all staged duty reductions had reached 'Free', making the phasing provisions spent. Part 4 repeals these spent table items and makes consequential amendments.

The EM describes this as simplifying Australia's tariff legislation, with no policy or revenue impact. Removing spent provisions is a routine legislative maintenance task — it does not change any duty rates or trade obligations under the Peru-Australia FTA, which continue to operate as agreed. The repeal simply removes obsolete text from the statute book.

Evidence review

Financial impact and legislative path

The EM states the Russia/Belarus extension results in negligible additional customs duty receipts. The nuisance tariff abolition reduces business compliance costs with negligible revenue impact. The Ukraine relief and Peru cleanup have no material financial impact.

The bill was introduced on 27 May 2026 and is now before the Senate. As a tariff bill (coded 'T'), it deals with taxation measures that cannot originate in the Senate but can be amended by it. If the bill does not pass within the statutory period, the provisional effect of the incorporated tariff proposals lapses.

Given the bill's composition — non-controversial deregulation, bipartisan-supported sanctions on Russia, humanitarian relief for Ukraine, and administrative cleanup — the bill addresses measures that have historically drawn consensus across the chamber.

Evidence review

Chamber record cross-check — 2 July 2026

Senate Dynamic Red listed Customs Tariff Amendment (Incorporation of Proposals) Bill (No. 1) 2026 on 2026-07-02. The working chamber record described the position as “listed for Senate consideration or debate”. Dynamic Red is a same-sitting record and can change as proceedings continue; the corrected Hansard and current bill page control the final procedural account. For Customs Tariff Amendment (Incorporation of Proposals) Bill (No. 1) 2026, this date-specific entry should therefore be treated as a procedural snapshot rather than a final status, and checked against the later settled record before drawing a conclusion.

Evidence review

Chamber record cross-check — 11 August 2026 (Senate)

Senate Dynamic Red listed Customs Tariff Amendment (Incorporation of Proposals) Bill (No. 1) 2026 on 2026-08-11 as a government bill under second reading debate. The working chamber record listed no amendments as circulated at the time of capture. Dynamic Red is a same-sitting record and can change as proceedings continue; the corrected Hansard and current bill page control the final procedural account. This date-specific entry is a procedural snapshot rather than a final status.

Evidence review

Chamber record cross-check — 13 August 2026 (Senate)

Senate Dynamic Red listed Customs Tariff Amendment (Incorporation of Proposals) Bill (No. 1) 2026 on 2026-08-13 as a government bill under second reading debate. The working chamber record showed a second reading amendment circulated: Sheet 3919 (One Nation). Dynamic Red is a same-sitting record and can change as proceedings continue; the corrected Hansard and current bill page control the final procedural account. This date-specific entry is a procedural snapshot rather than a final status.

Common questions

Before you rely on the answer