Surge in reporting errors puts importers at risk, cautions BDO
A significant increase in reporting errors has been revealed in a recent compliance update from the Australian Border Force, raising concern for importers.
The Australian Border Force reporting errors and misclassifications highlighted by the compliance update could lead to overpayment and underpayment of customs duty and GST, BDO has warned.
The key reporting errors included tariff classification, invoice term types, valuation dates and delivery addresses frequently cited as sources of inaccuracies.
BDO tax partner Leonie Ferretter said these misclassifications presented significant challenges for importers.
“These errors can lead to heightened compliance risks, with potential penalties and audits becoming more likely,” Ferretter said.
“Misclassifications and incorrect valuations not only impact cash flow but can also strain profit margins, leading to unexpected financial burdens.”
Ferretter noted supply chains for time-sensitive products could also be impacted by operational delays caused by inaccurate declarations.
This would negatively impact customer satisfaction and business reputation, Ferretter said.
Despite raised concerns, challenges would also provide “valuable opportunities” for these businesses and importers.
Ferretter said businesses could enhance their compliance by investing in comprehensive training programs, ensuring staff are well-informed and reducing human error.
“Adopting technology solutions, such as automated customs compliance software, can streamline processes and reduce human error,” she said.
“Engaging in voluntary disclosure programs also allows businesses to correct mistakes proactively, fostering a culture of transparency and accountability.”
An emphasis on sustainability and ethical practices has grown as businesses have adapted to the evolving landscape of international trade.
“Importers that prioritise compliance may also find new opportunities in aligning with global standards, appealing to environmentally conscious consumers,” Ferretter said.
“By integrating sustainability into their compliance strategies, businesses can enhance their brand reputation and capture new market segments.”
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