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| 7th Report of Market Access Ombudsman Council (March 18, 2002) |
1. Complainant: Hiroshima Chamber of Commerce and Industry
2. Ministry concerned: Ministry of Finance
3. Complaint:
The importer has been importing pajamas from China. The goods in question had been benefiting from the preferential tariff rate (zero tariff duty). However, "the laws to revise part of the Customs Tariff Law and other laws" (Law of 2001, No. 21) were enforced in a rushed manner and a tariff rate of 8.5% has been imposed on imports in and after April 2001.
The importer had been importing the goods in March and followed import procedures in April every year. In the latest year, the importer also planned to import the goods in April and follow import procedures in April. However, due to the above revision of the laws, the importer had to pay tax on what had been duty free.
With respect to this case, the importer heard about the revision only from a customs broker. Based on a Customs Tariff Council report carried in the "Tsusho Koho" of late January 2001, the broker told the importer that "in view of the revision of the law, the goods in question are most likely to be removed from the list of items that are given preferential tariff treatment in and after April and that the removal will become definite when the revised law is enacted by the Diet at the end of March." Given the trading practice that an importer normally determines the specific amount of planned imports and concludes contracts with the exporter three months before actually importing, the importer needs to know for definite about the change of items concerning preferential customs duty at least three months beforehand. Therefore, instead of making the enforcement of a revised law known via a council report, which does not have any binding power on the people, and enforcing the law the day after it was promulgated, a law should be enforced following a familiarization period of about three months after it was promulgated.
(Second complaint)
It may be beyond the control of the ministry. However, we want the ministry to further strengthen its publicity activities and make officials of customs houses fully aware of the moves of customs tariff revision, even at the stage of submission of a report by the council.
4. Corresponding Policy of the Ministries concerned:
(1) Schedule for fiscal year-end revision of customs tariff
The Customs Tariff Law and other laws are revised in principle every fiscal year. This is because tariff revenue estimate constitutes part of the tax revenue estimate and because tariff revision as well as tax revision is incorporated in single-year budgetary policies. Therefore, the annual revision of customs tariff takes effect on April 1. The work schedule for tariff revision is basically the same as those for budget compilation and tax revision. Specifically, it goes along with the reference below.
(Reference) July: Ask ministries and agencies concerned to survey revision requests, Late August: Deadline for submission of revision requests; September-December: Consultations with ministries and agencies concerned on revision requests, and investigation and deliberation by councils; Late December: Council to submit report on tariff revision for the next fiscal year; January: Drafting legislation/Examination by the Cabinet Legislation Bureau; February: After a Cabinet decision, legislation is to be introduced to the Diet (Although it depends on the progress of deliberations at the Diet, legislation is usually passed by the Diet in mid or late March. Work for revising relevant Cabinet or ministerial ordinances to enforce revised laws will be made in time for the enforcement date.)
(2) Method of drafting proposed amendment
Bills to revise the Customs Tariff Law and other laws that will be deliberated at the Diet are normally submitted by the Cabinet, and the Ministry of Finance is in charge of drafting the bills. Under laws and ordinances, the Council on Customs, Tariff, Foreign Exchange and other Transactions "shall deliberate revision of tariff rates and other important matters concerning customs tariff in response to the Minister of Finance's request for advice" (Article 8 of the Ministry of Finance Establishment Law, Article 6 of the Council on Customs, Tariff, Foreign Exchange and other Transactions Law). After the deliberation, the Council submits a report on annual revision, which the Minister of Finance uses as a guideline for drafting an amendment.
(3) Announcement to the public
In view of the nature of annual revision as mentioned above, the details of revision to laws, government ordinances, and ministerial ordinances concerning customs tariff are announced in official gazettes at the end of March.
In consideration of the short period from promulgation to enforcement, the Customs and Tariff Bureau of the Ministry of Finance makes the details of expected tariff revision readily available to the people. It announces the Council report, which serves as the guideline for annual revision, in newspapers and on the Internet (also in Jetrodaily) in late December and Cabinet-decided amendments on the Internet in early February.
With respect to the revision of tariff rates, in particular, the announcement on the Council report, not to mention the announcement on the Cabinet decision, carries clear and specific description of the substance.
(4) Conclusion
As we have described above, since law is usually enacted in mid or late March, there is almost no time span from the date of law promulgation in an official gazette to the date of law enforcement. However, since the work schedule for annual revision of customs tariff is usually fixed at the end of each year as in the case of tax revision that constitutes part of budgetary policies, it is difficult to move the work schedule, including the date of law enactment.
However, in order to help people make estimates concerning annual revision of customs tariff, the Ministry of Finance is striving to provide people with the Council report that constitutes a guideline for annual revision, including item-by-item revision of tariff rates, and legislative bills submitted to the Diet.
Although the report by the statutory council is not a decision by the Diet, it is a decision made after discussions by men of learning and expertise on customs tariff and the government authorities prepare proposed amendments based on the report. Therefore, we want the complainant to understand that the report is an extremely useful item of material when estimating the details of tariff revision.
(Second corresponding policy)
With regards to the points made in the re-complaint, the ministry has been striving to make officials of customs houses fully aware of the progress of tariff revision even at the stage of report submission by the council, in addition to taking the measures mentioned in our previous response.
5. Remarks
The complainant accepted this policy.