Excise Regulations (Amendment) 1994 No. 81
EXPLANATORY STATEMENT
STATUTORY RULES 1994 No. 81
Issued by the authority of the Minister for Small Business, Customs and Construction
Excise Act 1901
Excise Regulations (Amendment)
Section 164 of the Excise Act 1901 (the Act) provides in part that the GovernorGeneral may make regulations not inconsistent with the Act prescribing all matters which by the Act arc required or permitted to he prescribed for giving effect to the Act.
Subsection 4(1A) of the Acts Interpretation Act 1901 provides that, where an amending Act amends a principal Act in such a way as to confer additional power to make regulations, then, unless the contrary intention appears, the regulation-making powers contained in the principal Act prior to and after the commencement of the amending Act may he exercised by making a single instrument, and that instrument is deemed to be made under subsection 4(1) of the Acts Interpretation Act 1901.
Subsection 4(1) of the Acts Interpretation Act 1901 provides that, where an amending Act amends a principal Act in such a way that the principal Act will confer power to make regulations, then the power may be exercised before the amendment come into operation as if they had come into operation.
The Customs and Excise Legislation Amendment Act 1993 and the Excise Tariff Amendment Act (No. 2) 1993 introduced amongst other things, two reforms to address identified area or potential areas of revenue leakage. The first reform has made the blending of petroleum products with other products a process of manufacture subject to both licensing under the Act and payment of duties under the Excise Tariff Act 1921 (the Tariff). The duty payment would be equal to the leaded gasoline rate if any of the constituents of the blend is gasoline, or the diesel fuel rate if none of the constituents of the blend is gasoline. The second reform has made beer produced for non-commercial purposes using commercial facilities or equipment also subject to licensing under the Act and to the payment of duties of excise under the Tariff.
The Customs and Excise Legislation Amendment Act 1993 inserted a new section 77J into the Act which provides that the regulations may declare certain blended petroleum products to be exempt from the new regime. In order to implement the first reform in accordance with the desired policy, it was considered necessary to exempt a number of blended petroleum products from the new regime so that manufacturers of such products will not require licensing or payment of duties upon production. The exemptions were based upon exempting current accepted practices from which the identified revenue leakage does not occur.
The second reform, that is, making beer produced for non-commercial premises using commercial facilities or equipment excisable, required a number of regulations to be promulgated under section 39 of the Act to specify the prescribed drawings and particulars that must be contained in an application for licensing of manufacturers of beer produced far non-commercial purposes using commercial facilities or equipment; and under subsection 39(2) of the Act to specify the amount of the required security to be given by the applicant for a licence.
A detailed explanation of the Regulations is at Attachment A.
ATTACHMENT A
Regulation 1 - Commencement
Provides that the Regulations commence on 1 April 1994 which was the date of proclamation for both the reforms.
Regulation 2 - Amendment
Provides that the Excise Regulations are amened by the Regulations.
Regulation 3 - New Part 10
Inserts a new Put 10 into the Excise Regulations which prescribes the exempt blended petroleum products.
New regulation 175 provides that expressions used in the new Part 10 of the Excise Regulations that are defined in the new Part VIIB of the Excise Act 1901 have the same meaning as defined in that Part.
New subregulation 176(1) defines waste oil for the purposes of five exempt blended petroleum products.
New subregulation 176(2) identifies 21 exempt blended petroleum products for the purposes of section 77J of the Excise Act 1901.
New paragraph 176(2)(a) to (e) provide that blends of various petroleum products with waste oil (as defined in new subregulation 176(1) are to be exempt blended petroleum products provided that the appropriate amount of duty has been paid on the non-waste oil components of the blend.
New paragraph 176(2)(f) provides that two stroke gasoline which is a blend of gasoline and a lubricating oil for use in lawn mowers is an exempt blended petroleum product provided that the gasoline component of the blend has bow duty paid at the correct
New paragraphs 176(2)(g), (h) and (i) provide that certain packaged products, which are blends of a petroleum product with another product, and are available at service stations and are used to enhance some aspect of an engine's performance am to be exempt blended petroleum products provided that duty has been paid on the petroleum product at the appropriate rate.
New paragraphs 176(2)(j) and (k) maintain the Government's alternate fuel policy, that is, blends of petroleum products with ethanol or methanol should be only subject to duties on the petroleum product and not on the whole blend.
New paragraph 176(2)(l) provides that blends of leaded and unleaded petrol in the tanks of loaded petrol vehicles are to be exempt blended petroleum products.
New paragraph 176(2)(m) provides that a blended petroleum product not suitable for use as fuel is to be an exempt blended petroleum product provided the petroleum product has been cleared from Customs control.
New paragraph 176(2)(n) provides that blending of diesel fuel and fuel oil on board a vessel for use as a bunker fuel on that vessel will result in an exempt blended petroleum product.
New paragraph 176(2)(o)provides that a blend of duty paid diesel fuel and crude oil exempted from duty under the terms of subitem 11(h) of the Tariff to be an exempt blended petroleum product.
New paragraph 176(2)(p) provides that by-products of refining crude oil that are not suitable for use as a fuel but am blended petroleum products are to be exempt blended petroleum products.
New paragraph 176(2)(q) provides that a blended petroleum product produced in a licensed Customs warehouse will he an exempt blended petroleum product provided it has been entered for home consumption under item 11 Of the Schedule to the Tariff.
New paragraph 176(2)(r) provides that a blend of duty paid heating oil with duty paid kerosene where the
blend is for use as beating oil is to be an exempt blended petroleum product.
New paragraph 176(2)(s) provides that a blend of condensate and crude oil for use as a refinery feedstock or for export is to be an exempt blended petroleum product.
New paragraphs 16(2)(t) and (u) blends of petroleum products that have been duty paid at the appropriate rates are to be exempt blended petroleum products.
Regulation 4 - Regulation 213 (Labelling of beer in bottles or on packages containing beer)
Provides that the labelling requirements in regulation 213 of the Excise Regulations are not to apply to beer produced for non-commercial purposes using commercial facilities and equipment.
Regulation 5 - Regulation 214 (Security for quantity of beer that may be manufactured for commercial purposes)
Provides that the securities provided for in regulation 214 of the Excise Regulations only apply to beer produced for commercial purposes.
Regulation 6 - New regulation 214A
Inserts a new regulation 214A into the Excise Regulations to specify the amount of security required for a manufacturer of beer produced for non-commercial premises using commercial facilities or equipment. The required security will be $200 where production is to be 100,000 litres or less, or $400 where the production will exceed 100,000 litres.
Regulation 7 - Regulation 215 (Application for licence to manufacture beer for commercial purposes)
Provides that the drawing and particulars referred to in regulation 215 of the Excise Regulations only apply for beer produced for commercial purposes.
Regulation 8 - New regulation 215A
Inserts a new regulation 215A into the Excise Regulations which specifies the drawings and particulars that must be given by an applicant for a licence to manufacture beer for non-commercial purposes. The details are similar to those listed in regulation 215 but slightly more detailed so as to ensure safety and security for the new excisable products manufactured on the premises.