Understand Australian import duty, GST, and customs charges before your first shipment. Includes worked examples, FTA savings, and common mistakes.
Import duty (also called customs duty) is a tax the Australian Government charges on goods brought into the country from overseas. It’s administered by the Australian Border Force (ABF) and is designed to regulate trade and protect local industries.
Think of it as the entry fee your products pay to come into Australia. The amount you owe depends on three main factors: what you’re importing, how much it’s worth, and where it’s coming from.
Import duty is just one part of the total cost of bringing goods into Australia. You’ll also need to factor in Goods and Services Tax (GST), import processing charges, and potentially other fees like biosecurity inspections or terminal handling. We’ll cover all of these below.
When your shipment arrives in Australia, you’ll typically face three government-related charges. Here’s the breakdown:
ChargeRateCalculated OnCustoms DutyUsually 5%FOB value (cost of goods, excluding freight and insurance)GST10%Customs value + duty + freight + insurance (CIF + duty)Import Processing Charge (IPC)~$50–$190Flat fee per import declaration, varies by declaration type
Important: Goods valued at AUD $1,000 or less are generally exempt from customs duty and GST at the border (with the exception of alcohol and tobacco products). This makes small sample orders and test shipments much more cost-effective.
Australian customs duty is typically calculated on the FOB (Free on Board) value of your goods. That’s the price you paid for the products at the point of export, before international shipping and insurance costs are added.
The standard duty rate for most general cargo is 5%. However, some product categories attract different rates — from 0% on many electronics and raw materials, up to 10% or more on certain textiles and finished goods. The exact rate depends on your product’s tariff classification under the Harmonized System (HS code).
Let’s say you’re importing a container of flat-pack furniture from Foshan, China. Here’s how the numbers might look:
Cost ComponentAmount (AUD)FOB value of goods$20,000International freight (sea)$3,500Insurance$500CIF value (cost + insurance + freight)$24,000Customs duty (5% of FOB $20,000)$1,000Import Processing Charge$152GST (10% of $24,000 + $1,000 + $152)$2,515Total duty, charges & GST$3,667Total landed cost (before local transport)$27,667
💡 Pro Tip: If your business is GST-registered, you can claim back the GST you paid on imports as an input tax credit through your Business Activity Statement (BAS). This effectively makes the GST a cash flow issue rather than a hard cost. Talk to your accountant about whether the Deferred GST Scheme might work for your business — it lets you defer GST payments to your BAS rather than paying at the border.
This is where it gets good. Australia has free trade agreements (FTAs) with a number of key trading partners, and they can significantly reduce — or completely eliminate — the duty you pay on imported goods.
The China–Australia Free Trade Agreement (ChAFTA) has been in force since December 2015, and it’s a game-changer for Aussie importers. Under ChAFTA, Australia has eliminated the 5% tariff on most Chinese manufactured goods — including electronics, machinery, clothing, furniture, and consumer products.
To claim the preferential 0% rate, you’ll need a Certificate of Origin (COO) from your Chinese supplier confirming the goods were manufactured in China and meet the Rules of Origin requirements. Your customs broker or freight forwarder can help you with this process.
🔍 Good to know: Even with ChAFTA, GST still applies. The duty might be zero, but you’ll still pay 10% GST on the total import value. The savings on duty, however, can be substantial — on our furniture example above, that’s a $1,000 saving straight to your bottom line.
If you’re sourcing from other countries in Asia, these FTAs are worth knowing about:
AgreementCountriesKey BenefitAANZFTAASEAN nations (incl. Vietnam, Thailand, Indonesia)Reduced or zero duty on many manufactured goodsRCEP15 Asia-Pacific countriesSimplified Rules of Origin across multiple FTAsCPTPP11 countries incl. Vietnam, Japan, MalaysiaProgressive tariff reductions across member statesKAFTASouth KoreaZero duty on most manufactured goods
At Epic Sourcing, we help our clients source from both China and Vietnam, and understanding which FTA applies to your products can make a real difference to your landed cost. If you’re not sure which agreement covers your situation, get in touch with our team and we’ll point you in the right direction.
Every product imported into Australia is assigned a tariff classification based on the Harmonized System (HS code). This is an internationally standardised system used to categorise traded products, and it determines the rate of duty you’ll pay.
Australian tariff codes are typically 8 digits long. The first 6 digits follow the international standard, and the last 2 are Australia-specific. Getting the right HS code matters — classify your goods incorrectly and you could end up paying too much duty, or worse, face penalties from the Australian Border Force.
Here are a few common examples relevant to Aussie importers:
Product CategoryHS ChapterGeneral DutyChAFTA RateClothing & textilesCh. 61–635%0% (COO req.)FurnitureCh. 945%0% (COO req.)ElectronicsCh. 84–850–5%0%Packaging materialsCh. 39, 480–5%0%Cosmetics & skincareCh. 330–5%0%Building materialsVarious0–5%0% (most)
If you’re unsure about your product’s tariff classification, the Australian Border Force’s Tariff Classification Database is a good starting point. Alternatively, a licensed customs broker can provide a formal ruling.
Here’s one that a lot of importers don’t know about. If you’re importing goods that aren’t manufactured in Australia or aren’t available in sufficient quantities locally, you may be able to apply for a Tariff Concession Order (TCO).
A TCO allows you to import those specific goods at a reduced or zero customs duty rate. The Australian Border Force administers these, and while the application process takes some effort, the ongoing savings can be significant for businesses importing regularly.
TCOs are particularly relevant for niche or specialised products — think unique manufacturing components, specialist equipment, or materials that simply aren’t produced in Australia.
1. Not factoring in GST on top of duty. Remember, GST is calculated on the total value including duty and freight — not just the product cost. It’s 10% of a bigger number than most people expect.
2. Forgetting to request a Certificate of Origin. Without a valid COO, you can’t claim FTA preferential rates. Make sure your supplier provides this before your goods ship.
3. Using the wrong HS code. This can result in overpaying duty, underpaying (which leads to penalties), or delays at the border. When in doubt, get professional advice.
4. Ignoring the $1,000 threshold for samples. Goods under AUD $1,000 are generally exempt from duty and GST at the border. Use this for cost-effective sample orders before committing to a full production run.
5. Not claiming GST credits. If you’re GST-registered, you can claim back the GST you paid on imports. Too many businesses let this slip through the cracks.
6. Underestimating total landed cost. Duty and GST are just part of the picture. Don’t forget terminal handling charges, customs broker fees, quarantine inspections, and local delivery. First-time importers often underestimate total landed costs by 15–25%.
If you’re importing regularly, the Deferred GST Scheme is worth looking into. Instead of paying GST upfront at the border when your goods arrive, you can defer the payment and report it on your next Business Activity Statement (BAS).
This can make a massive difference to your cash flow, especially if you’re bringing in multiple shipments per month. To qualify, you need to be registered for GST, lodge your BAS monthly, and have your import declarations lodged electronically.
Chat to your accountant or customs broker about whether the Deferred GST Scheme is right for your business.
Technically, you can lodge your own import declarations with the Australian Border Force. But in practice, most businesses use a licensed customs broker — and for good reason.
A good customs broker will make sure your goods are classified correctly, ensure you’re claiming every FTA benefit you’re entitled to, handle all the paperwork with the ABF, and flag any compliance issues before they become expensive problems. For most importers, the broker’s fee pays for itself many times over.
At Epic Sourcing, we work closely with trusted freight forwarders and customs brokers across Australia. When you source through us, we can connect you with the right logistics partners to make sure your goods clear customs smoothly and cost-effectively. Learn more about our freight forwarding services.
Before you import your next shipment, run through this checklist:
✅ Confirm your product’s HS code and applicable duty rate
✅ Check if an FTA (e.g. ChAFTA, AANZFTA) reduces or eliminates duty
✅ Request a Certificate of Origin from your supplier
✅ Calculate total landed cost: FOB + freight + insurance + duty + GST + charges
✅ Engage a licensed customs broker for formal declarations
✅ Ensure you’re claiming GST input tax credits on your BAS
✅ Explore the Deferred GST Scheme if importing regularly
✅ Check for applicable Tariff Concession Orders (TCOs)
✅ Budget 15–20% above product cost for all import-related charges
Import duty is just one piece of the puzzle. When you’re sourcing products from China or Vietnam, there’s a lot to get right — from finding the right supplier and negotiating pricing, through to quality control, shipping, and customs clearance.
That’s where we come in. At Epic Sourcing Australia, we’ve helped hundreds of Aussie businesses navigate the sourcing process from start to finish. Whether you’re a first-time importer or looking to scale up your supply chain, our team in Australia, China, and Vietnam has got your back.
Ready to get started? Book a free discovery call with our team and let’s talk about your sourcing needs.
Most general cargo imported into Australia attracts a standard customs duty rate of 5% calculated on the FOB (Free on Board) value. However, this rate can be reduced to 0% under free trade agreements like ChAFTA (for Chinese goods) or AANZFTA (for Vietnamese goods), provided you have a valid Certificate of Origin. Some product categories, like certain electronics, are already duty-free.
Yes. GST of 10% applies to most goods imported into Australia. It’s calculated on the total of the customs value, customs duty, freight, insurance, and the import processing charge. If your business is GST-registered, you can claim back this GST as an input tax credit on your BAS.
Goods valued at AUD $1,000 or less are generally exempt from customs duty and GST at the border. This doesn’t apply to alcohol, tobacco, or goods that are part of a larger consignment split to avoid the threshold.
The most effective way is to claim preferential rates under the China–Australia Free Trade Agreement (ChAFTA). Most manufactured goods from China now enter Australia duty-free under ChAFTA, but you’ll need a Certificate of Origin from your supplier. Working with a customs broker ensures you’re claiming every benefit you’re entitled to.
The Australian Border Force charges an Import Processing Charge (IPC) for every import declaration lodged. The amount varies depending on the type of declaration and the value of the goods, typically ranging from around $50 to $190. This is a flat fee, not a percentage.
A sourcing agent like Epic Sourcing can’t directly reduce government-imposed duties, but we can help you get the right documentation (including Certificates of Origin), connect you with experienced customs brokers, and ensure your landed cost calculations are accurate before you commit to an order. It’s all part of the service.
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