The government is taking steps to strengthen management to prevent the misuse of the quota tariff system. This aims to ensure that low-tariff goods are swiftly supplied to the market to stabilize prices. Measures include enhancing distribution checks and considering the application of customs evasion charges for deliberate delays.
On the 26th, Deputy Prime Minister and Minister of Economy and Finance, Koo Yun-cheol, presided over the second task force meeting on special management of living expenses at the government complex in Seoul. Discussions focused on strategies for managing special items related to living expenses and reviewing and improving the quota tariff system.
In response to recent increases in exchange rates, oil prices, and price instability, the government has expanded the list of goods eligible for quota tariffs. However, some importers have delayed import declarations or stored low-cost goods brought in under quota tariffs in bonded areas. A quota tariff allows for up to a 40% point reduction in tariffs on specific items to stabilize prices and supply.
To prevent system abuse, the government has prepared management measures across different stages of the quota tariff operation. High-risk items, such as those with high storability like frozen meat or those with a history of delayed release from bonded areas, will be designated as ‘high-priority items for quota tariff management.’
An obligatory deadline for removal from bonded areas is being established, expanding requirements currently applicable to livestock products to other items. The penalty for delayed import declarations after entry into bonded areas will be strengthened, with the criterion for imposing additional taxes shortened from the current 30 days to 20 days.
A new system will allow customs heads to order removal from bonded areas upon request from relevant departments. Failure to comply with such orders will result in higher fines, suggested to be increased from the usual 1 million KRW level to 5 million KRW.
Customs authorities are launching a high-intensity investigation into operators abusing the system through false recommendations or deliberate delays, with the application of customs evasion charges if warranted.
To ensure rapid supply to the domestic market, the obligation to provide evidence of performance will be expanded to other items, similar to the sugar case requiring supply details within 180 days after import declaration approval. Failure to comply with removal and rapid distribution obligations will lead to the revocation of the allocation qualification for quota tariff goods.
Enhanced information sharing between departments will occur, immediately notifying customs authorities of recommendation issuance or cancellation and sharing violation information for future recommendations or exclusions.
A dedicated organization will oversee the entire process from import to distribution and sales, with candidates like the Korea Agro-Fisheries & Food Trade Corporation (aT) being considered. Choi, the policy officer, stated that aT would analyze from a referee’s perspective, with participation from the Ministry of Agriculture and the price authorities for thorough review.