How Is Import Duty and GST Calculated in Australia?

All imported goods are potentially subject to import duty and GST before they can be released for delivery by the wharf, airport bond store or Australia Post in the case of international parcels arriving by mail.

My team and I at Depth Logistics are commonly asked how import duty and GST is calculated so by way of this post I will explain the basic principles.

Import Duty is determined by the classification of goods in the Customs Tariff and the applicability of concessions. The duty rate can range from FREE to 10%, however the standard rate for most goods is 5%.

Our licensed customs brokers classify your goods in the Customs Tariff and proactively search for concessions, by-laws and Free Trade Agreement exemptions that may make the goods duty free. Our Tariff Consultants can also make application to Customs for Tariff Concessions on your goods. Learn more about Tariff Consultancy Services.

Australia has numerous Free Trade Agreements with many of its major trading partners and is currently entering into more. With the right declarations and/or Certificates of Origin it means we can legally claim exemption from import duty on your goods.

Import Duty is calculated as a percentage of the goods value or Customs Value (CV) of your consignment.

GST is calculated at 10% of the Value of the Taxable Import (VoTI). The VoTI is calculated by the addition of the Customs Value (CV) plus the Duty plus the value of the International Transport and Insurance (T&I).

Here is an example of how the import duty and GST is calculated on goods valued at AUD$1000 which attract a 5% duty rate:

Duty @ 5% of the AUD$1,000 (CV) = $ 50.00(Duty)

International transport and insurance (T&I) = $ 150.00

Then the VoTI = (CV) + Duty + (T&I) = $1,200.00

GST is 10% of the VoTI = 10% x $1200 = $ 120.00(GST)

Total Duty and GST Payable $ 170.00

Depth Logistics Customs Brokers are online to Customs Cargo System so this means lower Customs declaration processing fees for you compared to lodging import declarations manually yourself. The charges Customs levy for this are called Electronic Entry Charges(EEC). These charges range from $50.00 to about $194.00 depending on the value of the goods and mode of transport. Also as our customs brokers are online to Customs it means that in the majority of case cargo clearance processing is near instantaneous except where Customs may have a query or other concern.

Import duty and GST is paid to Customs by a daily direct debit facility on the customs brokers bank account. This is why customs brokers and freight forwarders usually require payment for these charges prior to delivery of your cargo.

If you are a frequent importer that lodges your Business Activity Statement monthly with the Australian Tax Office, we can also arrange to defer your payment of the GST to assist your cashflow.

If you would like more information about the applicable duty rates on goods you are importing, or any other aspect of customs clearance in Australia, please contact us or call toll free on 1DEPTH (133784).

All for now,

+Brad Skelton 

Shipping Industry Consolidation rolls on with Maersk Acquiring Hambug Sud

Maersk Transport & Logistics, the world’s biggest shipping container company, have announced the successful acquisition of German rival, Hambug Sud in a $4.02 billion deal.

Combined, the two companies will be able to realize annual operational savings of about $350 million to $400 million, Maersk Line said in a statement fleshing out detail on the deal announced in December.

“By keeping Hamburg Sud as a separate and well-run company, we will limit the transaction and integration risks and costs while still extracting the operational synergies,” said Soren Skou, CEO of both Maersk Line and its parent A.P. Moller-Maersk Group.

This marks an important milestone on Maersk’s journey towards growing a new, stronger business alliance, which continues to offer clients integrated cargo solutions.This acquisition also evidences continued consolidation in the container trade where some carriers cannot continue without sustained profitability. This consolidation is decreasing capacity in some trade lanes including Australia and has made this year peak season the worst in many years.

Ultimately, although final approval from regulatory authorities in countries such as Brazil, China and South Korea, Maersk Line expects the Hamburg Sud transaction to close by the end of the year.

There has been unprecedented consolidation of shipping lines the last two years and others exiting altogether. The losses most have incurred are unsustainable so I am certain that we will see more consolidation into 2018 and rates must rise if shippers are to enjoy stable shipping services meeting there needs.

All for now,

+Brad Skelton

The World's First Electric, Autonomous, Zero-Emissions Ship

Welcome the Yara Birkeland

Welcome the Yara Birkeland, with a capacity of up to 150 shipping containers, the battery-powered ship will be small compared to modern standards (the biggest container ship in the world holds 19,000 containers, and an average-size ship holds 3,500), but its launch will mark the beginning of a transformation of the global shipping industry. This transformation could heavily impact global trade as well as the environment.

It's estimated that the ship will cost $25 million, which is about three times the cost of a similarly-sized conventional ship. However, the savings will kick in once the ship starts operating, since it won’t need traditional fuel or a big crew.

The Yara Birkeland won’t take to the sea unmanned on its first voyage, nor any of its several first voyages, for that matter. It'll undergo multiple types of tests to refining its sensors, upgrade its software, and generally improve it functionality little by little.

Rather, the ship’s autonomy will be phased in but the ship will eventually run fully on its own, under supervision from shore, in 2020.



The United Nations’ International Maritime Organization estimates over 90 percent of the world’s trade is carried by sea, and states that maritime transport is “By far the most cost-effective way to move en masse goods and raw materials around the world.”

Studies show that just 15 of the world’s biggest ships may emit as much pollution as all the world’s cars, largely due to the much higher sulfur content of ship fuel. Oddly, shipping emission regulations weren’t included in the Paris Agreement.

Interestingly, there’s currently no legislation around autonomous ships (which makes sense since, well, there aren’t any autonomous ships, either). Lawmakers are getting to work, though, and rules will likely be set up by the time the Yara makes it first fully-autonomous trip.

All for now,
+Brad Skelton

The Demise of Antonov Cargo Aircraft

The Ukraine government has just recently commenced a special commission to manage the process of liquidating aircraft maker Antonov.

Antonov was established in 1946 as a top secret top-secret Soviet aviation design and research bureau. It manufactured passenger, cargo, and special purpose aircraft. Among the company's best-known aircraft are the giant AN124 Ruslan and An-225 Mriya cargo planes. The world's largest airplane AN225 was built to carry the Soviet Buran shuttle orbiter.

In 2010, Antonov and Russia’s United Aircraft Corporation (UAC) signed a deal to form a joint company. They agreed to cooperate in marketing, sales, design, and production of military, civilian and cargo aircraft as well as modifying new Antonov airplanes.

Most recently however, the Ukrainian government has forced Antonov, a state owned company, to sever its contract with UAC, leading to its liquidation. This comes as part of a wider action to freeze all Ukrainian-Russian Projects.

The demise of Antonov will leave a huge gap in the project airfreight market as there simply isn't any other aircraft currently flying commercially that have the same heavy lift capability that these incredible aircraft do.

It will be sad to see these aircraft eventually go even though the demand for them has decreased with the downturn in resources globally.

The last time I was on board an Antanov was at the Avalon Airshow in Victoria earlier this year. The last three pictures in this blog were taken there. This aircraft was not only on display but carrying American Apache helicopters back to the US after the show.

Please contact myself or the team at Depth Logistics for any heavy lift cargo you may ever need to transport.

All for now,

+Brad Skelton 

Why Interstellar Travel Will Be Possible Sooner Than You Think

The term “moonshot” is sometimes invoked to denote a project so outrageously ambitious that it can only be described by comparing it to the Apollo 11 mission to land the first human on the Moon. The Breakthrough Starshot Initiative transcends the moonshot descriptor because its purpose goes far beyond the Moon. The aptly-named project seeks to travel to the nearest stars.

The brainchild of Russian-born tech entrepreneur billionaire Yuri Milner, Breakthrough Starshot was announced in April 2016 at a press conference joined by renowned physicists including Stephen Hawking and Freeman Dyson. While still early, the current vision is that thousands of wafer-sized chips attached to large, silver lightsails will be placed into Earth orbit and accelerated by the pressure of an intense Earth-based laser hitting the lightsail.

After just two minutes of being driven by the laser, the spacecraft will be traveling at one-fifth the speed of light—a thousand times faster than any macroscopic object has ever achieved.

Each craft will coast for 20 years and collect scientific data about interstellar space. Upon reaching the planets near the Alpha Centauri star system, an the onboard digital camera will take high-resolution pictures and send these back to Earth, providing the first glimpse of our closest planetary neighbors. In addition to scientific knowledge, we may learn whether these planets are suitable for human colonization.

While this endeavor may sound like science fiction, there are no known scientific obstacles to implementing it. This doesn’t mean it will happen tomorrow: for Starshot to be successful, a number of advances in technologiesare necessary. The organizers and advising scientists are relying upon the exponential rate of advancement to make Starshot happen within 20 years.

Here are 11 key Starshot technologies and how they are expected to advance exponentially over the next two decades.

1. Exoplanet Detection
An exoplanet is a planet outside our Solar System. While the first scientific detection of an exoplanet was only in 1988, as of 01 May 2017 there have been 3,608 confirmed detections of exoplanets in 2,702 planetary systems. While some resemble those in our Solar System, many have fascinating and bizarre features, such as rings 200 times wider than Saturn’s.

2. The reason for this deluge of discoveries? A vast improvement in telescope technology.
Just 100 years ago the world’s largest telescope was the Hooker Telescope at 2.54 meters. Today, the European Southern Observatory's Very Large Telescope consists of four large 8.2-meter diameter telescopes and is now the most productive ground-based facility in astronomy, with an average of over one peer-reviewed, published scientific paper per day.

3. Launch Cost
The Starshot mothership will be launched aboard a rocket and release a thousand starships. The cost of transporting a payload using one-time-only rockets is immense, but private launch providers such as SpaceX and Blue Origin have recently demonstrated success in reusable rockets which are expected to substantially reduce the price. SpaceX has already reduced costs to around $60 million per Falcon 9 launch, and as the private space industry expands and reusable rockets become more common, this price is expected to drop even further.

4. The Starchip
Each 15-millimeter-wide Starchip must contain a vast array of sophisticated electronic devices, such as a navigation system, camera, communication laser, radioisotope battery, camera multiplexer, and camera interface. The expectation we’ll be able to compress an entire spaceship onto a small wafer is due to exponentially decreasing sensor and chip sizes.

For Starshot to succeed, we will need the chip’s mass to be about 0.22 grams by 2030, but if the rate of improvement continues, projections suggest this is entirely possible.

5. The Lightsail

The sail must be made of a material which is highly reflective (to gain maximum momentum from the laser), minimally absorbing (so that it is not incinerated from the heat), and also very light weight (allowing quick acceleration). These three criteria are extremely constrictive and there is at present no satisfactory material.

6. Energy Storage
While the Starchip will use a tiny nuclear-powered radioisotope battery for its 24-year-plus journey, we will still need conventional chemical batteries for the lasers. The lasers will need to employ tremendous energy in a short span of time, meaning that the power must be stored in nearby batteries.

7. Lasers
Thousands of high-powered lasers will be used to push the lightsail to extraordinary speeds.

8. Speed
Achieving 20% speed of light for Starshot would represent a 1000x speed increase for any human-built object.

9. Memory Storage
Fundamental to computing is the ability to store information. Starshot depends on the continued decreasing cost and size of digital memory to include sufficient storage for its programs and the images taken of Alpha Centauri star system and its planets.

10. Telecommunication
Once the images are taken the Starchip will send the images back to Earth for processing.

The bandwidth and speed required for Starshot to send digital images over 4 light years—or 20 trillion miles—will require taking advantage in the latest telecommunications technology.One promising technology is Li-Fi, a wireless approach which is 100 times faster than WIFI. 

11. Computation
The final step in the Starshot project is to analyze the data returning from the spacecraft. To do so we must take advantage of the exponential increase in computing power, benefiting from the  trillion-fold increase in computing over the 60 years.

All for now,
+Brad Skelton 

Farmfest 2017 - See Depth Logistics there

Depth Logistics will be proudly exhibiting at Farmfest 2017, Queensland's premier primary industry field days. This years event runs from 06 - 08 June at Kingsthorpe Park, Toowoomba.

Be sure to drop by site #S/18b, right near the Machinery and Vehicle Demonstration area, and say hello to the team! We look forward to meeting you and answering any and all of your freight forwarding questions and enquiries.

+Julie Magnone , +Anna Queiroz from Depth Travel , +Brittney Bowerman and I will all be onsite at various stages throughout Farmfest.

We hope to see you there.

+Brad Skelton 

The excellence is back at Depth Travel

Depth Travel’s brand promise is “For Excellence in Travel”. I was one of the original founders in 1998 and honestly speaking I think the company has failed to really “live” that promise consistently for our clients in recent years and progression stalled. This is no longer the case. My executive team and I have been busy re engineering, optimising and transforming every aspect of our business and service to you to ensure it is truly excellent and world class.

Like all other Depth companies our approach is to uncompromisingly deliver our clients the best service and technology available at affordable prices. Depth Travel has an expanded service offering, a greater corporate travel focus and a range of new initiatives.

My team and I are there for you more than ever before with a true 24/7 service available by phone on our new toll free number 1DEPTH (133784) or you can reach us on LIVE chat via our new website.

If you haven’t booked with us recently I hope that you might give us another opportunity to prove to you that we do have our “excellence” back with a vengeance and demonstrate our new capabilities and strengths.

I would welcome your call and any feedback you may have for me, good or bad, that may help us in our pursuit of excellence.

+Brad Skelton
Managing Director
Depth Travel

Rolls Royce shipping gamechanger arriving fast

I have made posts in the past showing how technology is transforming transportation at all levels.

Rolls Royce have an amazing vision for the future that cannot be ignored as most of the technology already exists. Integration is the key.

Here is a phenomenal YouTube clip showing what is coming.

All for now

+Brad Skelton 

Lockheed Martin Airships are the next generation in transport

About four years ago +Julie Magnone and I were meeting with one of our energy logistics clients. We had been engaged for our oversize logistics expertise to collaborate with their engineers in designing modules of their gas production plant. The goal being to optimise the design for operational efficiency, cost effective construction and transport.

From a pure construction and operational integrity standpoint the engineers were wanting to build modules as large as possible. So large that it made the land transport task impossible. We could easily transport the module sizes they wanted from overseas to the Port of Brisbane but getting them to site in central Queensland at that size was impossible due to numerous overhead bridges, power lines, railway lines, narrow roads etc en-route.

I remember clearly one of the engineers refusing to accept it was impossible and seriously demanding that we find airships that could move the cargo to site from the Port of Brisbane. Julie and I left the meeting thinking that he was slightly mad but nonetheless we did some research anyway and at that time there wasn't any airship flying capable of lifting more than a few tonnes at the most.

Well...not anymore thanks to Lockheed Martin.

A prototype, like the one pictured, is operational. It has a 7X improved cargo payload compared to what we found in earlier generation airships of 21000kg. The cargo bay is 18m long x 3m wide x 3m high and able to accommodate standard shipping containers and various other types of loads.

These airships can travel at a speed of 60 knots or 111km/h and have a range of about 2500km. Due to a special air cushion landing system, much like a hovercraft concept, they can land on water as well.

For transport into remote areas these airships are far superior than helicopters in nearly every respect. They are quieter and more fuel efficient as well!

Here is a YouTube clip to learn more.

While the current prototype still could not solve the transport task our client set for us it is fair to say it probably won't be too long before cargo bays and payloads starting increasing making Airship cargo transport a commercial reality.

Depth Airships here we come!

All for now,

+Brad Skelton 

NYK, MOL and K Line to merge container operations

Yesterday the three largest Japanese shipping lines Kawasaki Kisen Kaisha Ltd. (K-Line), Mitsui OSK Lines (MOL), and Nippon Yusen Kabushiki Kaisha (NYK) announced their agreement, subject to sign off by their respective boards and shareholder/regulatory approval, to establish a new joint-venture company and to integrate their container shipping operations.

M&A activity is sweeping the shipping industry globally as carriers in the wake of the Hanjin Shipping receivership fight to survive. The current wave of M&A activity is more about addressing structural industry issues by strengthening balance sheets, addressing poor investor returns and adapting to a low growth environment.

The industry still suffers from surplus capacity so M&A activity is needed to realign carriers and find synergies in cost reduction, economies of scale, improved competitive positioning and better protection from the prevailing weak industry fundamentals.

This announcement is another positive step for the industry where a significant number of carriers have not made money in the recent years. People that were affected by Hanjin's demise know the problems this caused and is still causing so hopefully another failure by a major carrier can be avoided.

The industry must navigate it's way back to a healthy and sustainable performance for all stakeholders as fast as it can.

All for now,

+Brad Skelton 

New generation of car carrying ships now able to use the expanded Panama Canal

The term "Panamax" refers to ships of a size able to use the original Panama Canal. Prior to the expansion of the canal, which opened in July this year, some ships could not use the shortcut between North and South America. They were simply too big. Therefore many ships were designed and built to a maximum, "Panamax" size.

Since the opening of the expanded canal even the worlds largest ships can travel via the canal thus saving time and money. Ship owners have been building new bigger ships to take advantage of the improved economies of scale. These are called "Post-Panamax" ships.

Hoegh Autoliners now operates the worlds largest PCTC(Pure Car & Truck Carrier) and Post-Panamax ship in the "Hoegh Target". In fact she is the first PCTC of this size to transit via the canal.

The "Hoegh Target" can carry an incredible 8500 cars and has 71400 square metres of deck space. Importantly she is very fuel efficient and Hoegh claim will halve the emissions per car that they carry.

Here are a some pictures of her in the expanded Panama Canal.

Innovative vessels like this and the expanded Panama Canal are contributing to keeping freight rates lower for shippers.

All for now,

+Brad Skelton 

Trade Finance is a way to ship more inventory more often

I have been pleased to be able to help many of Depth Logistics' clients with Trade Finance to fund their import and export activity. As I have spoken to many of them I have been surprised that most haven't even heard of this type of financing but when they do the majority have embraced it even if to reduce their reliance on financing from their bank.

It can give you greater and more transparent buying and selling power and the ability to ship more inventory, more often without tying up working capital.

For the uninitiated here are more of the key benefits of Trade Finance.

• Available for imports and exports
• Increase your negotiating buying power by being able to pay your supplier faster
• Export more by being able to offer your buyer credit terms
• Approvals within 5 days with a single establishment fee
• Competitive interest rates available with up to 90 day terms
• Does not interfere with existing bank security arrangements or letters of credit
• Security is taken over the goods and a director’s guarantee only
• Easy shipping and marine insurance arrangements via Depth Logistics
• Credit facility is available in multiple foreign currencies
• Bridge the gap between your shipping and other finance facilities such as Debtor Finance

Depth Logistics works in tandem with Depth Capital to provide this service so please contact me if you'd like to learn more about it.

All for now,

+Brad Skelton

Ross Radich is back with our team at Depth Logistics

In the past month I have been extremely happy to have re-joined forces with +Ross Radich who is back working with the familiar team and clients at Depth Logistics as our Biosecurity Consultant.

Ross was originally a New Zealand Quarantine officer before joining my team about 12 years or so ago. He is a true gentleman, very reliable, diligent and always gets even the most difficult jobs done in a good humored manner. It's a sincere privilege to work with him.

During this time Ross has lived and travelled literally all over the world working with our clients and their suppliers making sure that cargo destined for Australia and New Zealand is prepared before shipping to minimise quarantine risks and achieve the smoothest possible clearance on arrival. In fact Ross has a perfect record on cargo he has inspected and prepared with not a single re-export order ever being issued.

The characters he has met, the places he has gone and the stories Ross has collected along the way are often amazing and funny. Ross written a book of them in fact and it's available on Amazon.

I really enjoyed reading the book and recalling many of the situations and stories. It's a great and entertaining read with good insights into the great work Ross has done not only for our clients, but in the big picture, in helping to minimise quarantine risks for Australia and New Zealand.

I hope you might buy a copy so we can help add "Best Selling Author" to Ross' list of accomplishments.

All for now,

+Brad Skelton 

The 20-Year-Old With a Plan to Rid the Sea of Plastic

As the branding of Depth Industries suggests the team and I all have a strong affinity with the ocean.

I came across this amazing project that promises to clean up the oceans of the estimated 150 million tonnes of plastic floating out there that is even gradually entering our own food chain through seafood. Check out this YouTube clip.



A simple but brilliant idea!

All for now,

+Brad Skelton 

Please help me to help the homeless at the Vinnies CEO Sleepout

The latest figures released by the Australian Bureau of Statistics show that 105,237 people in Australia are experiencing homelessness, with 60% of those under the age of 35. Perhaps surprising to many people is that 44% of these are women, 13% are under the age of 12. These figures in a lucky country like Australia are disgraceful.

On 23 June 2016 I will join with Brisbane’s community leaders and CEOs to spend one night on the streets as part of the Vinnies CEO Sleepout. We will experience homeless life in an endeavour to raise awareness and crucial funds for St Vincent’s homeless services.

Last year I raised $1,520.00 through donations from clients, suppliers, family and friends. This year I am aiming to better this amount and hope you will join with me to do so. Please click here to sponsor me and donate to support this great cause.

Thank you!

+Brad Skelton 

Global ship traffic as seen from space

I came across this fascinating (1min 40sec) YouTube clip of one weeks global shipping traffic as seen from space courtesy of Fleetmon.

Take a look...


All for now,

+Brad Skelton