Public Consultation - Part 2 of the Customs Tariff Act 2012

Introduction

The Revenue Management Division (RMD) of the Ministry of Finance and Economic Management (MFEM) is initiating a public consultation process regarding the following changes to Part 2 of the Customs Tariff Act 2012.

1. Amending Tariff Concession and Value Added Tax (VAT) Exemption on Personal Importation (Concession Reference Number 80)

   
   

2. New Tariff Concession and Value Added Tax (VAT) Exemption on Returning Cook Islanders for the Purpose of Educational, Vocational Training, work placements and secondments (Concession Reference Number 85.03); and

   
   

The proposed change seeks to increase the current threshold under Concession Number 80—relating to one-off personal importations by post, sea, or air freight—from $100 to $750. This adjustment aims to bring it in line with Concession Number 86, which applies to accompanied baggage and personal effects that passengers receive upon arrival in the Cook Islands.

Furthermore, the proposed change also introduces a new concession for Cook Islanders who have lived overseas less than 3 years (specifically for the purpose of educational, vocational training or advancement) prior to their arrival in the Cook Islands and have arrived to take up work or live permanently for three years or more.

Consultation Feedback

Any individual or organization wishing to provide feedback on this consultation is invited to submit their comments or submissions via email to customs.info@cookislands.gov.ck and or to elizabeth.tetauru@cookislands.gov.ck.

Requests for an extension of time to submit feedback will be considered only in exceptional circumstances and on a limited basis. Such requests must be submitted via email to Maria Matua-Ioane at maria.matua@cookislands.gov.ck  and or to Elizabeth Tetauru at elizabeth.tetauru@cookislands.gov.ck  no later than 4:00 PM on Monday, 16 June 2025.

Justification for Amending the Current Concession for Personal Importation (Concession Reference Number 80)

The Cook Islands Government acknowledges that the current threshold of $100 has remained unchanged for several years, despite significant increases in global shipping costs and inflation. As a result, many low-value personal purchases now exceed the threshold, unintentionally subjecting individuals to VAT charges on small, essential items.

In addition, other comparable jurisdictions—including New Zealand and Australia—have implemented higher thresholds (up to NZD $1,000) for personal importation to reduce administrative burdens and support consumer flexibility. A threshold of $750 aligns more closely with regional standards and simplifies border processes. Furthermore, aligning the concession for personal importation with that for accompanied baggage will ensure consistency and uniform application of concessions administered by Customs.

The increase in threshold would ease the financial burden on residents who import personal goods, especially those goods not readily available in the Cook Islands. This is especially relevant for students, remote workers, and families relying on online purchases for everyday items.

What is the Effect of the Tariff and VAT Concession?

The effect of the proposed tariff concession would mean that imported goods (excluding alcoholic beverages, tobacco products, and any other goods subject to excise duty) not exceeding NZD$750.00 will not be subject to any import tariffs or VAT on arrival in the Cook Islands.

How the Tariff Concession and VAT Exemption Will Be Implemented?

The proposed tariff concession and VAT exemption will be implemented by amending Concession number 80 in Part 2 Concessions of the Cook Islands Customs Tariff Act 2012 by deleting the value $100.00 and substituting with the value $750.00.

Justification for Inclusion of a New Tariff Concession and VAT Concession for Returning Cook Islanders Who Have Lived Overseas for Two Years or More (Specifically for the Purpose of Educational or Vocational Training or Advancement)

The Cook Islands Government acknowledges that the current Concession 85.02 applies only to Cook Islanders who have lived overseas for three years or more prior to their return to the Cook Islands to either work or reside permanently for a minimum period of three years. While this concession appropriately considers Cook Islanders returning from extended periods abroad, it does not account for those who have been overseas for two years or more specifically for the purpose of educational or vocational training or advancement.

The proposed amendment to this concession seeks to address this gap by extending eligibility to Cook Islanders who have been studying, undertaking vocational training, work placements, or secondments overseas for less than 3 years. This change will ensure equitable treatment for returning students and trainees who are contributing to national development by acquiring skills and qualifications abroad. It also reinforces the Government’s commitment to supporting education, vocational training, work placements, secondment and lifelong learning, while recognising the temporary yet purposeful nature of these absences from the Cook Islands.

What is the Effect of the Tariff and VAT Concession?

The proposed tariff concession would exempt any accompanied and unaccompanied baggage and personal effects subject to specific conditions, from import duties and VAT upon arrival in the Cook Islands, provided the items are not intended for commercial purposes.

How the Tariff Concession and VAT Exemption Will Be Implemented?

The proposed tariff concession and VAT exemption will be implemented by inserting a new concession 85.03 after concession 85.02 in Part 2 Concessions of the Cook Islands Customs Tariff Act 2012.

What is the Anticipated Date of Implementation?

The anticipated date for the changes proposed in this consultation to come into effect is 1 August 2025.

For enquires related to this release, please email: mfem.comms@cookislands.gov.ck