Customs Act amended to ease the burden of businesses in times of pandemics

by FAYYADH JAAFAR / pic source: Customs Department FB

THE government has introduced the Customs (Amendment) Bill 2022 in Parliament today — which seeks to amend Act 235 of the Customs Act 1967 — to ease the burden of businesses in times of public health emergencies and public health crises such as the recent Covid-19 pandemic.

Deputy Minister of Finance II Yamani Hafez Musa, who tabled the bill, said the proposed amendment to the Act would allow the Minister of Finance (MoF) to extend the time limit for the payment of duties and taxes and to grant extensions for the submission of declarations.

“The main amendment to Act 235 is the result of the Covid-19 pandemic, where the implementation of the Movement Control Order has limited business activities and operations, which has resulted in taxpayers not being able to fulfil their obligations under the act.

“Therefore, a new provision was included in Act 235 to enable certain facilities to be given to taxpayers in the event of a public emergency or public health crisis,” he told Dewan Rakyat today.

He added that the proposed amendment would also provide for the form and manner of applications to obtain a customs ruling and the method of calculation of customs duty payable through the form.

A total of 16 clauses were included in the bill, which aims to amend certain sections in Act 235, such as Sections 57, 59, 83, 86, and 94 to replace the words “in the prescribed form” with the words “in the form and manner as determined by the director general”.

It also sought to empower the MoF to determine the form and manner of declaration for imported dutiable goods, duty-free goods that are imported and exported using rail transport, as well as the application for a refund of customs duty that has been paid on goods imported and then reexported; and to delete subsections 142(12) and 142(35E) as well as Section 145, considering that the DG, through this proposed act, is empowered to determine the form and manner of declaration for the matter in question.

The amendment also adds new sections 145C and 145D to Act 235, which empowers the MoF to extend any period before the expiry of the period prescribed under Act 235 or its subsidiary legislation, if the period cannot be met by any person due to the occurrence of a public emergency such as a natural disaster or a public health crisis such as Covid-19.

Meanwhile, section 145D empowers the minister to add, delete or change any terms and conditions imposed pursuant to Act 235, provided that an information notice is given in advance to the person bound by the terms and conditions.

“Overall, this amendment to Act 235 is positive in nature, which will benefit taxpayers in fulfilling their obligations under Act 235 and its subsidiary legislation.

“With the amendment of the prescribed form to the form and manner that can be determined by the DG, the various types of customs forms that are currently used no longer need to be prescribed under regulations but can instead be published in the form of general rulings published through the Customs Department’s official portal.

“Indirectly, it will make it easier for the industry to make references centrally, and if there are any changes to the details in the form in line with current circulation, updating the form is also easier and faster to implement,” he said.

He also noted that the provision of authority to the minister to extend the period and change the terms and conditions set out also do not give absolute authority to the minister to arbitrarily extend the period or change the terms and conditions.

Rather, the extension of the period is only implemented based on the needs of the taxpayer when public emergencies such as natural disasters or public health crises such as the Covid-19 pandemic occurred, while changes in terms and conditions were only implemented after consultation with the industry and based on certification and detailed reviews by the Customs Department.