Australian Border Force’s Goods Compliance Update - May 2025

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Short on time? Read the key takeaways.

The Australian Border Force (ABF) has released its latest Goods Compliance Update, which reveals the ABF's recent areas of customs compliance focus. 

1. Compliance monitoring results – tariff classification 

The ABF monitors the accuracy of import and export declarations, as well as cargo reports, through the Compliance Monitoring Program. The latest ABF Goods Compliance Update reported a spike in declaration errors – specifically in tariff classification, invoice terms, delivery addresses, valuation dates, invoice price and related transaction indicators.

Tariff classification is a top compliance priority for the ABF. Penalties can apply for incorrect classification of goods, even where there is no difference to the customs duty paid.

We recommend that a tariff advice be sought from the ABF where there is uncertainty regarding classification or Tariff Concession Order (TCO) eligibility or for high volume or high value goods. A tariff advice minimises risk of delays at the time of importation, protects importers from penalties and confirms TCO eligibility – potentially reducing the duty rate to free. 

2. Piggybacking ABN fraud  

The ABF issued a warning about a growing trend in attempted Australian business number (ABN) fraud, also referred to as ‘piggybacking’ in its latest Goods Compliance Update. This fraudulent activity is an attempt to use the import history and credentials of an established business to bring goods into the country. This is a serious form of fraud and can have damaging consequences for the business being targeted, including compliance actions and seizure notices for illicit goods, which can be costly and adversely impacts the importer’s trade standing.

We recommend regularly obtaining the import Goods and Services Tax (GST) report from the ABF to review transactions to ensure your organisation is not subject to such fraud. 

3. Understanding GST-free foods and GST exemptions for importers 

While the Australian Taxation Office (ATO) overseas the administration of GST, the ABF oversees GST on imported goods, ensuring exemptions are correctly applied and the value of taxable importations are accurately calculated. 

Where the sale of goods domestically would be GST-free, the same importation is a non-taxable importation (GST exempt). Despite limited GST-free food provisions being in place for 25 years, they remain complex and prone to error.

ABF and ATO audits frequently uncover incorrect use of GST food exemptions. The ABF and ATO do share information, which means that for importer-distributors, potential errors can be compounded - once for the importation misclassification, then again for the domestic sale GST misclassification. Incorrect GST exemption lodgements can lead to increased risk of audits, penalties and reputational risk.

We recommend regularly reviewing import data to ensure goods entered with a GST exemption are entitled to claim that exemption and if not, amending import declarations to accurately reflect the GST.

How BDO can help 

This ABF Goods Compliance Update underscores the ABF’s heightened scrutiny on tariff classification, internal controls and GST classification. BDO offers tailored support to help businesses navigate these evolving compliance challenges with confidence. 

 Our customs, international trade and excise team can provide businesses with support in: 

  • Preparing tariff advice applications by accurately classifying goods under Australian customs tariff, identifying eligibility for TCOs, compiling comprehensive supporting documentation and engaging proactively with the ABF during the process 
  • Protecting your supply chain by developing practical internal controls and data verification procedures that incorporate fraud detection to mitigate the risks of ABN misuse and identity fraud 
  • Reviewing the GST treatment of goods in import declarations as well as taking advantage current free trade agreements and customs concessions to reduce customs duty liabilities. 

Contact us today to learn more about how we can support your business. 

Key takeaways

Tariff classification errors remain a key risk area
  • The ABF continues to observe a high rate of declaration errors, particularly in tariff classification. These errors can attract penalties, even where no duty shortfall exists, highlighting the importance of accurate and well-supported classifications.
Proactive use of tariff advice minimises compliance exposure
  • Where uncertainty exists, especially for high-value or high-volume goods, importers are encouraged to seek a tariff advice from the ABF. This not only supports correct classification but also confirms Tariff Concession Order (TCO) eligibility, potentially reducing duty to zero and avoiding cost delays.
ABN 'piggybacking' fraud poses a growing threat
  • The ABF has flagged a rise in fraudulent activity involving the misuse of legitimate ABNs to import goods. This can result in compliance actions and reputational damage for the affected business. Regularly reviewing your import GST report can help detect and prevent unauthorised transactions.
GST-free food imports require ongoing scrutiny
  • Despite long-standing provisions, GST exemptions on food imports remain complex and error-prone. Misapplications can lead to audits by both the ABF and ATO, compounding compliance risks. Importers should routinely review GST-exempt entries and amend declarations where necessary.

Read the full article for further information or contact our customs, international trade and excise team to discuss your options.

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