Bills Digest No. 185  1997-98 Excise Tariff Amendment Bill (No. 1) 1998


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This Digest was prepared for debate. It reflects the legislation as introduced and does not canvass subsequent amendments. This Digest does not have any official legal status. Other sources should be consulted to determine the subsequent official status of the Bill. >

CONTENTS

Passage History
Purpose
Background
Main Provisions
Endnotes
Contact Officer and Copyright Details

Passage History

Excise Tariff Amendment Bill (No. 1) 1998

Date Introduced: 8 April 1998

House: House of Representatives

Portfolio: Customs and Consumer Affairs

Commencement: The amendments reducing the rate of excise on AVGAS commence on 3 July 1997 (item 3) and after the commencement of the Excise Tariff (Fuel Rates Amendments) Act 1997 (items 4 and 5). The amendments clarifying the classification structure for petroleum products commence after the commencement of the Excise Tariff (Fuel Rates Amendments) Act 1997.

Purpose

The major amendments:

  • reduce the rate of excise duty on AVGAS from $0.18003 to $0.17403 per litre; and
  • clarify the classification structure for petroleum products.

Background

The major amendments proposed by the Bill can be said to have two effects, namely, to reduce the rate of excise duty on AVGAS from $0.18003 to $0.17403 per litre, and clarify the classification structure for petroleum products under item 11 of Schedule 1 of the Excise Tariff Act 1921.

The excise duty on AVGAS assists in recovering Airservices Australia costs of providing certain services to the aviation sector, including terminal and navigational services.

While Government information sources are more circumspect in indicating the source of the proposed reductions in the excise duty payable on AVGAS proposed by the Bill, Airservices Australia indicates the source to be the rationalisation of services provided by Airservices Australia.

The Government states in its Explanatory Memorandum to the Bill that:

The reduction results from close scrutiny by Airservices of the forecast cost of services provided to general aviation and a review of the forecast level of activity by the general aviation sector in 1997-98.(1)

In Airservices Australia (AA) Annual Report 1996-97, AA states:

[the reduction in duty] is the result of anticipated savings in costs following the rationalisation of services at a number of General Aviation Airport Procedures (GAAP) aerodromes.(2)

The proposed clarification of the classification structure for petroleum products under item 11 of the Schedule to the Excise Tariff Act 1921 relates to a new classification structure for petroleum products introduced by the Excise Tariff (Fuel Rates Amendments Act 1997. That Act, which commenced operation on 31 January 1998, amended the Excise Tariff Act 1921 to define the petroleum products to which a prescribed fuel marker must be added, prior to their distribution for home consumption. That Act formed part of a package of 9 Acts aimed at minimising the practice of avoiding excise duty on transport fuels through the substitution or unauthorised blending of lower rated petroleum products.

The rationale, as stated by the Minister in the Second Reading Speech to the Bill, for the clarifying amendments is:

The petroleum industry was consulted at all stages of policy development and implementation of this package [ie. the package of 9 Acts]. It was concerned the new structure may create misunderstandings as to how much excise was payable on some petroleum products intended for particular uses, particularly products used otherwise than as fuels.

Accordingly, the technical amendments contained in this Bill are designed to remove any such uncertainty. The amendments insert new subheadings of "other" in all sub-items of item 11 except sub-item 11(A) and 11(D), to cover petroleum products used otherwise than as fuel.

Main Provisions

The effect of items 3-6 of Schedule 1 of the Bill is to reduce the excise duty on AVGAS from $0.18003 to $0.17403 per litre.

The amendments proposed by items 7-14 of Schedule 1 of the Bill are intended to clarify the classification structure for petroleum products.

Endnotes

1. Excise Tariff Amendment Bill (No. 1) 1998, Explanatory Memorandum, 3.

2. Airservices Australia, Annual Report 1996-97, 35.

 

 

Contact Officer and Copyright Details

Ian Ireland
30 April 1998
Bills Digest Service
Information and Research Services

This paper has been prepared for general distribution to Senators and Members of the Australian Parliament. While great care is taken to ensure that the paper is accurate and balanced, the paper is written using information publicly available at the time of production. The views expressed are those of the author and should not be attributed to the Information and Research Services (IRS). Advice on legislation or legal policy issues contained in this paper is provided for use in parliamentary debate and for related parliamentary purposes. This paper is not professional legal opinion. Readers are reminded that the paper is not an official parliamentary or Australian government document.

IRS staff are available to discuss the paper's contents with Senators and Members
and their staff but not with members of the public.

ISSN 1328-8091
Commonwealth of Australia 1998

Except to the extent of the uses permitted under the Copyright Act 1968, no part of this publication may be reproduced or transmitted in any form or by any means, including information storage and retrieval systems, without the prior written consent of the Parliamentary Library, other than by Members of the Australian Parliament in the course of their official duties.

Published by the Department of the Parliamentary Library, 1998.



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