EXPLANATORY STATEMENT
EXCISE ACT 1901
EXCISE REGULATIONS (AMENDMENT)
STATUTORY RULES 1988 NO. 388
ISSUED BY THE AUTHORITY OF THE MINISTER OF STATE FOR SCIENCE, CUSTOMS AND SMALL BUSINESS
These Statutory Rules insert a new refund circumstance in the Excise Regulations (paragraph 50(1)(r)) for Excise duty paid by the oil marketing companies on aviation turbine kerosene on or before 30 June 1988. New regulation 52D provides that the amount of refund is to equal the full amount of Excise duty actually paid.
In addition, some general requirements for remission, rebate or refund applications are prescribed.
Details of the Regulations are as follows:
Regulation 1: paragraph (1)(c) of the Statutory Rules amends subregulation 50(1) of the Excise Regulations by inserting a new refund circumstance at paragraph 50(1)(r).
This circumstance is designed to allow oil marketing companies a refund of the Excise duty paid on aviation turbine kerosene on or before 30 June 1988, where that kerosene was used as fuel for aircraft after 30 June 1988.
The introduction of this new circumstance arises from the May 1988 Economic Statement, in which the Treasurer provided details of the new Civil Aviation Authority (CAA). The Government proposed that the functions of the Authority would be partially funded by direct domestic en route charges levied by the CAA in place of the traditional budget revenues from Excise duties on aviation turbine kerosene (Avtur).
The removal of the Excise duties on Avtur was notified in the Commonwealth of Australia Gazette No. GN 23 in Notice No. 3 (1988) of 29 June 1988 with effect from 1 July 1988.
Following the announced removal of the Excise duty on Avtur, representations were made to the Government for a refund of Excise duty paid in respect of such product held in stock after midnight on 30 June 1988; oil marketing companies in particular had stocks of Avtur at country airports on which duty had been paid at the rate in force prior to 1 July 1988, i.e. $0.16634 cents per litre, and some of these stocks were held after 1 July 1988.
The new circumstance effected by this Regulation permits the refunding of Excise duty in the above fact situation. The circumstance is restricted to Avtur which was held at the relevant time by persons named in Schedule 2 to the declaration under the Prices Surveillance Act 1983 in relation to petroleum products, published in the Commonwealth of Australia Gazette No. S330 of 22 August 1984.
The purpose served by this restriction is to ensure that only the major oil marketing companies are eligible for the refund on the ground that these companies were constrained by the operation of the Prices Surveillance Act 1983 from recovering, through their wholesale prices, the Excise duty paid on stocks of Avtur held at midnight on 30 June 1988, via the prices they could charge for Avtur after 30 June 1988 (i.e. the Prices Surveillance Authority reduced the maximum endorsed wholesale price of Avtur by $0.16634 cents per litre with effect from midnight on 30 June 1988. As the oil marketing companies complied with this decision, they were prevented from recovering in the marketplace the Excise paid on their stocks of Avtur at the time the Excise was abolished).
Other businesses were not similarly constrained and, further, had an opportunity to run down their stocks of Avtur before 30 June. It was in the community’s interest that the oil marketing companies should do the opposite and maintain stocks of fuel at airports where fuel is not held in bond. Had they not done so, air services at those airports would have been disrupted and users discouraged from reducing their own stocks.
Thus, the Government considered it reasonable in the circumstances to reimburse the oil marketing companies for the amount of Excise involved, and to indicate in advance to them that it proposed to do this. Failure to do so would have removed the incentive for oil marketing companies to maintain stocks of Avtur at the airports referred to above.
In addition, paragraphs (1)(a) and (1)(b) of the Statutory Rules effect the necessary technical drafting amendments to allow a new circumstance to be added to regulation 50.
Regulation 2: amends regulation 52 of the Regulations (which prescribes some administrative requirements for an application for remission, rebate or refund of duty), by providing two additional requirements as follows:
• the application must be signed by the applicant (new paragraph 52(1) (a)); and
• the Collector may require the applicant to produce records and/or request further information for the purpose of enabling the Collector to verify that a prescribed circumstance does in fact apply in relation to the goods to which the application relates (new subregulation 52(2)).
Regulation 3: inserts a new regulation 52D into the Excise Regulations which provides that where the refund circumstance in new paragraph 50(1)(r) is established, the amount of refund that may be allowed is an amount per litre equal to the amount per litre of Excise duty paid.