Excise Regulations (Amendment)

Administered by Department of the Treasury

Legislation au F1996B03047 Regulations Not in force Legislative Instrument

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EXPLANATORY STATEMENT

Statutory Rules 1985 No. 141

Excise Regulations (Amendment)

Issued by the Authority of the Minister of State for Industry, Technology and Commerce

The main purpose of the attached regulations is to prescribe, pursuant to section 24 of the Excise Act 1901, the cases and conditions under which beer while subject to control of the Customs may be used in the manufacture of other beer.

The prescribed cases and conditions for beer (specified at Items 2 and 3 as set out in the Schedule to regulation 6) emanate from the revised taxing arrangements for beer as announced by the Treasurer in the 1984/85 Budget Speech.

With effect from 8.00 pm on 21 August 1984 all Australian and imported beers, including those produced as brewed soft drinks, with an alcoholic strength exceeding 0.5% but not more than 1.15% by volume have been subject to the general 20% sales tax rate. From that time the rate of excise duty on beer with an alcoholic strength in excess of 1.15% and up to 3.8% was reduced from 66 cents per litre to 58 cents per litre. The excise duty on beer with an alcoholic strength of more than 3.8% has remained at 66 cents per litre.

By an alcohol evaporation process the higher strength alcohol beers may be used in the manufacture of lower strength alcohol beers. For example, beer with a strength above 3.8% may be used in the manufacture of beers with a strength above 0.5% and up to 1.15% or between 1.15% and 3.8%. Likewise beers with a strength of between 1.15% and 3.8% may be used in the manufacture of beers with a strength between 0.5% and up to 1.15%.

Low alcohol beers can also be produced by adding water to higher strength beers or by producing only to the desired strength.

Following legal advice section 24 of the Excise Act 1901 was amended to place beyond doubt that prescribed excisable goods may be used in the manufacture of other excisable goods in an excise factory without being required to enter for home consumption or pay excise duty.

The amendment to section 24 of the Excise Act 1901 is included in the Statute Law (Miscellaneous Provisions) Act (No. 2) 1984 and came into operation on 22 November 1984.

Details of the attached regulations are as follows:


Regulation 1

Provides the interpretation consequential upon the new Schedule 2 inserted by regulation 2.

Regulation 2

Provides that the cases and conditions under which certain excisable goods, while subject to control of the Customs may be used in the manufacture of other excisable goods are as set out in the new Schedule 2 to the Regulations.

Regulation 3

Has the effect of repealing two now redundant regulations (Regulations 21 and 26) as a consequence of their inclusion at Item 1 in a modernised form in the new Schedule 2 to the Regulations. Item 1 in Schedule 2 permits spirits or spirituous beverages to be used in the manufacture of tobacco, cigars, cigarettes or snuff subject to the conditions specified in Column 3 of the Schedule.

Regulation 4

Repeals Regulation 233 as a consequence of its inclusion in a modernised form at Item 5 in the new Schedule 2 to the Regulations. Item 5 in Schedule 2 permits spirits or essences or flavourings containing spirits to be used in the manufacture of spirituous beverages subject to the conditions specified in Column 3 of the Schedule.

Regulation 5

Amends the heading of the Schedule to the Regulations as a consequence of the insertion of a new Schedule 2 by regulation 6.

Regulation 6

Inserts a new Schedule 2 to the Regulations listing the cases and conditions under which certain excisable goods, while subject to control of the Customs, may be used in the manufacture of other excisable goods. Items 2, 3 and 4 in Schedule 2 set out the cases and conditions in respect of beer and spirits distilled from beer.

 

Overview

The Statutory Rules 1985 No. 141, titled Excise Regulations (Amendment), was enacted to amend the Excise Act 1901 by clarifying and prescribing the conditions under which beer, while under Customs control, can be used in the manufacture of other beer. This legislative update was introduced by the Minister of State for Industry, Technology and Commerce in response to the revised taxing arrangements for beer announced by the Treasurer in the 1984/85 Budget Speech, which included the introduction of a 20% sales tax rate for beer with an alcoholic strength exceeding 0.5% but not more than 1.15% by volume. The policy objective was to facilitate the use of higher alcohol beers in the manufacture of lower alcohol beers through an alcohol evaporation process, thereby ensuring a streamlined manufacturing process while adhering to the new excise and sales tax regulations. The regulations came into effect on 22 November 1984, aligning with the implementation of the new tax rates on beer.

Scope and Application

The Excise Regulations (Amendment) under the Excise Act 1901, specifically Statutory Rules 1985 No. 141, outline the specific circumstances and conditions under which beer, while subject to customs control, can be used in the production of other beer. These regulations apply to all persons and entities involved in the brewing and manufacturing of beer within Australia, encompassing both Australian and imported beers. The regulations were issued in response to the revised taxing arrangements for beer as announced by the Treasurer in the 1984/85 Budget Speech, and they came into effect on 22 November 1984. The amendments clarify that excisable goods can be used in the manufacture of other excisable goods in an excise factory without the need for the goods to enter home consumption or for excise duty to be paid. The regulations also revise and modernise the Schedule to include new conditions and cases, thereby repealing and replacing certain previous regulations.

Key Provisions

The Statutory Rules 1985 No. 141, Excise Regulations (Amendment), issued under the authority of the Minister of State for Industry, Technology and Commerce, amends the Excise Act 1901, particularly Section 24, to clarify the use of beer and other excisable goods in manufacturing processes. Regulation 2 establishes the conditions under which beer, while under customs control, can be used to manufacture other beer (Items 2 and 3 in Schedule 2). The regulations specify that beers with varying alcoholic strengths can be combined through processes such as alcohol evaporation or dilution to produce beers of different strengths. The Excise Regulations impose specific obligations on manufacturers, ensuring that any use of beer in the production of other beer complies with the conditions set out in Schedule 2. Manufacturers must ensure that the excisable goods are used in accordance with the specified cases and conditions to avoid the requirement of entering the goods for home consumption or paying excise duty. This regulation ensures that the use of excisable goods in manufacturing is both compliant and efficient. Violating the provisions set out in these regulations can lead to significant penalties. While the specific penalties are not detailed in the explanatory statement, breaches of excise laws generally result in both civil and criminal penalties. Civil penalties can include fines and the recovery of unpaid duties, while criminal penalties can include imprisonment, reflecting the seriousness with which the law regards non-compliance with excise regulations.

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.