On 15 March 2010 an employee of an importer submitted an import entry form with Customs for wine. She made a mistake on the form which resulted in an underdeclaration of duty of 24k and GST of 3k.

She realised the mistake the same night and immediately on turning up to work the next morning she sent a corrected entry form to Customs who had not picked up on the error.

Six months later (six months!!) Customs wrote to the importer company seeking an explanation. The company replied explaining the mistake by its employee (who lost her job over this!) and on 11 November 2010 Customs imposed a penalty of $5,500.

The company applied to have the penalty cancelled and was successful in the Customs Appeal Authority which recently gave its decision.

Did a mistake which was corrected within 24 hours before Customs even realised it occurred really deserve a penalty?
What’s more, was it a good use of taxpayer funded time to impose a penalty 6 months after the event which then took up the time and resources of the Appeal Authority, Customs Chief Legal Counsel and the appellant’s lawyers?


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