Cost recovery

The Australian Government provides a diverse range of services, support and benefits to the Australian public to achieve its policy outcomes. A number of these activities are funded from different revenue sources which include general taxation, sale of public assets, investments, charging and other revenue measures. Cost recovery involves the Australian Government charging the non-government sector some or all of the efficient costs of a specific government regulatory activity.

We impose charges based on cost recovery for all cargo and trade related activities and citizenship activities. These include import processing charges (IPCs), licensing charges and charges relating to the provision of citizenship services.

Cost Recovery Implementation Statements

Cost Recovery Implementation Statements are explanatory documents that provide key information on how cost recovery is implemented. They have been prepared for cargo and trade related activities and citizenship activities. They report on how the activity is performing on an ongoing basis and are available on our website:


Stakeholder engagement is essential to best practice regulation. We review our cost recovery arrangements in line with the Australian Government Cost Recovery Guidelines, July 2014 routinely. When significant shifts in cost recovered activities, volumes and resulting expenditure and revenue occur, we will involve clients and stakeholders in the review process. We use our existing communication and engagement channels in order to consider a wide range of views. We will use established consultative committees, industry meetings and this webpage to keep you informed and will alert you to targeted consultation opportunities in the future.

The most recent changes to cost recovery arrangements were made as a result of recommendations made by the Joint Review of Border Fees, Charges and taxes, and were announced through the 2015-16 Commonwealth Budget.

Cargo and trade

Charges relating to cargo and trade activities include IPCs and broker, depot and warehouse licensing charges. Charges are dependent on the value of the consignment, method of importation and type of licence.

Cost recovery of selected cargo and trade related activities was announced through the 1996-1997 Commonwealth Budget. The announcement indicated that cost recovery would be introduced for elements of customs processing of import transactions. Cost recovery charging for cargo and trade related activities commenced on 1 April 1997. A number of changes have occurred to the charges for cargo and trade related activities since their inception, with the most recent being announced through the 2015-16 Commonwealth Budget.

Changes to IPCs and licensing were announced in the 2015-16 Commonwealth budget and were effective from 1 January 2016.

Import processing charges

The following changes to IPCs were made:

  • A modest increase to the existing rates of IPCs for air cargo, with a small reduction of IPCs for sea cargo. These changes intended to contribute Australian Dollar (AUD) 106.4 million over four years to the proposed reform initiatives of more than AUD 250 million.
  • Alignment of charges across air, post and sea cargo. These changes will better reflect the similarities in risk and volume profiles across the pathways and improve the consistency of cost sharing associated with processing imports.
  • The introduction of a consistent price differential between electronically and manually lodged declarations to reflect the additional work required to manually enter and process these documents.


We have three licence types with charges that are currently misaligned. The Fees Review identified ways in which charges could be aligned across all licence types, including:

  • The introduction of an application charge for broker and warehouse licences, with an equivalent reduction in the licence grant fee for warehouse licences. This would reduce the cost burden on the current licensing program, by charging all applicants, regardless of the application process.
  • The introduction of a variation charge for warehouse licences.


The Australian Government encourages permanent residents of Australia to apply for Australian citizenship when they become eligible. We currently charge fees for submitting various citizenship application types. These fees currently operate on a cost recovery basis, whereby the costs of the government delivering the service are recovered through the fees charged to applicants.

The cost of an application varies depending on an applicant’s eligibility and the activity requested. Fee exemptions and concessions exist for some applications (including family, pensioner and health card holders, among others).

Charging for citizenship activities date back to 1948, with the most current adjustment to citizenship related charges occurring in 2016.

On 1 January 2016, as part of the 2015-16 Commonwealth Budget, some citizenship activities that were partly government subsidised are now subject to full cost recovery arrangements.