Everything Australian businesses need to know about import duty in 2026 — how it's calculated, current rates, GST on imports, how to use ChAFTA and RCEP to pay less, plus the most common (and costly) mistakes Aussie importers make.
I've seen it happen dozens of times: a smart Australian entrepreneur sources a great product from China, lands the deal of their lives on the factory price, and then gets a nasty surprise when their shipment arrives and the landed cost is 30% higher than they budgeted.
Import duty. GST. Customs processing fees. They add up fast — and if you don't account for them before placing your order, they can turn a profitable product into a loss-maker overnight.
The good news? Australia's import duty system is actually pretty favourable for businesses that know how to use it. Thanks to free trade agreements like ChAFTA and RCEP, a huge number of products from China and Southeast Asia can be imported with zero or minimal duty.
This guide walks you through everything you need to know about import duty in Australia in 2026 — the rates, the calculations, the exemptions, and the smart strategies to keep your landed costs under control.
Import duty (also called customs duty) is a tax collected by the Australian Border Force (ABF) on goods imported into Australia. It's calculated as a percentage of the customs value of your goods — essentially, what you paid for them at the factory gate.
Import duty is separate from GST. They're both charges that apply at the border, but they're calculated differently and treated differently in your accounting.
Australia's tariff schedule is based on the Harmonised System (HS) code — an internationally standardised system for classifying traded products. Your HS code determines your duty rate.
0% duty — A large proportion of goods enter Australia duty-free, particularly under free trade agreements.
5% duty — The standard rate for most manufactured goods that don't qualify for a preferential rate. This covers clothing, footwear, furniture, electronics, plastics, and processed food.
Free of duty — Certain categories are specifically exempt, including most books, some medical devices and pharmaceutical goods, and many agricultural inputs.
The important thing to understand: the "standard" 5% rate is becoming increasingly irrelevant for Aussie importers, because most key sourcing markets — China, Vietnam, ASEAN countries — are covered by free trade agreements that reduce or eliminate these rates entirely.
Even if your goods are duty-free, you almost certainly still owe GST. GST at 10% applies to almost all goods imported into Australia. It's calculated on the customs value of the goods plus any duty payable plus international freight and insurance costs — known as the Value of Taxable Imports (VoTI).
For goods valued under AUD$1,000, private individuals generally don't pay GST or customs duty. However, this threshold does not apply to commercial imports or goods intended for resale.
If your business is registered for GST, you can claim the GST paid on imports as an input tax credit on your BAS. This effectively makes the GST a cash flow cost rather than a permanent expense.
On top of duty and GST, formal import declarations attract an Import Processing Charge (IPC). As of 2026, sea cargo attracts $50.70 per consignment for self-assessed clearance declarations; different rates apply for air cargo. This charge is relatively minor but worth accounting for in landed cost calculations.
ChAFTA came into force in December 2015, and by January 2019, 100% of China's dutiable exports to Australia were covered by tariff elimination. As of 2026, over 95% of Australian tariff lines for Chinese imports carry zero duty under ChAFTA.
In plain English: if you're importing most manufactured goods from China and claiming your ChAFTA preferential rate, you're not paying duty. Zero. Nil.
To claim ChAFTA rates, you need a Certificate of Origin from your Chinese supplier. Your China sourcing agent should be organising this as standard practice.
RCEP entered into force for Australia in 2022, creating a preferential trading framework with 14 Indo-Pacific countries including China, Japan, South Korea, New Zealand, and all ASEAN nations. It's particularly useful when building a diversified sourcing strategy across multiple Asian markets.
AANZFTA provides additional preferential rates for goods originating from ASEAN countries including Vietnam, Thailand, Indonesia, and Cambodia.
Your customs value is typically the FOB (Free on Board) value of your goods. Learn how FOB pricing works for Australian importers.
Multiply your customs value by your duty rate (0% if claiming ChAFTA or another FTA, 5% if standard rate applies).
VoTI = Customs Value + Duty + International Freight + Insurance. GST = VoTI × 10%.
Importing furniture from China: factory price AUD$10,000 FOB, freight + insurance $1,200.
Compare this to NOT claiming ChAFTA: 5% duty = $500 extra. On a $100,000 shipment, that's $5,000 down the drain. On a million-dollar annual import program, $50,000 per year in avoidable costs.
This is the big one. A staggering number of Aussie importers pay full duty rates on goods from China because they or their customs broker didn't obtain the necessary Certificate of Origin. For most manufactured goods from China, this is throwing money away.
Your duty rate is determined by your HS code. Getting it wrong can mean paying the wrong rate. A qualified customs broker can help ensure you're correctly classifying your goods.
Your wholesale sourcing strategy from China needs to account for full landed cost from day one.
Even under ChAFTA, some product categories have residual duty rates that won't hit zero until 2029. Check your specific HS code against the ChAFTA schedule or ask your customs broker.
Products in food, agricultural, timber, and certain other categories also face DAFF biosecurity requirements and potential inspection costs that can add to your landed cost and delay your shipment.
For most commercial importers — especially those shipping regular containers or dealing with complex product categories — yes, a licensed customs broker is worth every cent. A good broker will correctly classify your goods, identify and apply FTA preferential rates, manage import declarations with ABF, flag DAFF requirements, and help you avoid costly delays.
Australia's import duty framework is genuinely one of the more importer-friendly systems in the world — particularly for businesses sourcing from China and Southeast Asia. Between ChAFTA and RCEP, most manufactured goods entering Australia from key Asian markets can come in at zero duty.
But you have to know how to use the system. If you're just getting started with importing from China or Vietnam, have a yarn with the Epic Sourcing team.
Book a free discovery call → or drop us a line at gday@epicsourcing.com.au — we're always happy to chat.
