The Sub-Collector of Customs at Townsville in a memorandum dated 3 March 1902 to the Collector of Customs, Brisbane says:

Please advise whether discounts which vary from 20 per cent to 33W per cent taken off invoices for samples either for commercial travellers or to order from are to be allowed in estimating value for duty.

The Minister for Trade and Customs asks for advice on the validity of claims for allowances on samples.

The Customs Act, section 154 provides that the value of goods for duty is to be taken to be the fair market value of the goods in the principal markets of the country whence they were exported in the usual and ordinary commercial acceptation of the term etc.

The question of value is a question of fact, and should be determined in the case of samples in the same manner as in the case of other goods.

The fact that goods cost a particular importer a less amount because of special advantages which he had, or that by reason of special circumstances they are invoiced at a less rate than they would have been in ordinary circumstances, ought not in my opinion to be taken into consideration.

I am of opinion:

1. That in no case should discount be allowed on goods merely because they are samples.
2. That discount may be allowed in cases where the value of goods is depreciated by reason of cutting, breaking of sets, tarnishing etc. This applies equally to other goods as well as to samples.

[Vol. 2, p. 57]