Excise Regulations (Amendment)

Overview

The Excise Regulations (Amendment) 1984 was introduced to address a specific financial issue arising from the export of crude petroleum oil during the 1983-84 financial year. This amendment, issued under the authority of the Minister of State for Industry and Commerce, aims to facilitate the payment of rebates to oil producers for excise duty already paid on exported crude oil. The policy objective is to mitigate the financial impact on producers whose returns from exporting crude oil were lower than domestic prices subject to excise duty. To achieve this, the amendment allows for the payment of rebates based on a percentage of the difference between the import parity price and the actual export price received by each producer/exporter, with an expected total rebate amount of approximately $11 million for the financial year. This legislative amendment responds to the government's decision to permit the export of surplus crude oil from the Fortescue reservoir and Bass Strait. By enabling rebates, the government aims to support the oil industry during a period of fluctuating export prices, ensuring that producers are not unduly disadvantaged by the excise duty paid on their exports. The rebates are calculated individually for each producer/exporter, reflecting the unique volumes and prices of their exports, and will be adjusted once final production and export data for the year are available.

Scope and Application

The Excise Regulations (Amendment) primarily targets producers and exporters of crude petroleum oil who have paid excise duty on their exports during the 1983-84 financial year. These regulations apply to both stabilized crude petroleum oil produced from the Fortescue reservoir, referred to as "new" oil, and the surplus "old" oil from Bass Strait that exceeds domestic refiners' requirements. The amendment is focused on ensuring that those who exported crude oil and paid excise duty on these exports can receive a rebate, which compensates for the difference between the domestic prices on which excise duty is paid and the realised export prices. The rebates are calculated based on a percentage of the difference between the Bass Strait import parity price and the effective price achieved by each exporter. This legislative amendment is applicable within the Commonwealth jurisdiction, affecting entities involved in the oil production and export industry across Australia. The Excise Regulations (Amendment) extends its reach by allowing for the payment of rebates to qualifying producers and exporters of crude petroleum oil. However, it excludes any oil not classified as "stabilized crude petroleum oil" or not exported during the specified financial year. The scope of the rebate is determined by the specific conditions outlined in the amendment, which include the calculation of the rebate based on the prescribed rates. The regulations may be further adjusted through subordinate instruments once the final figures on production and exports are available, ensuring precise and equitable distribution of rebates. This amendment underscores the government's commitment to supporting the oil industry by providing financial relief through rebates on excise duties paid on exported crude oil.

Key Provisions

The Excise Regulations (Amendment) introduce a new provision in regulation 50, which concerns the payment of rebates for stabilized crude petroleum oil. Specifically, section 50 of the Excise Regulations now includes a scenario where rebates can be paid on stabilized crude petroleum oil that has had excise duty levied and is subsequently exported (section 50). This amendment is in response to the government’s decision to permit the export of certain quantities of oil from the Fortescue reservoir and Bass Strait, exceeding domestic refining requirements. Under the new regulations, entities exporting stabilized crude petroleum oil and having paid excise duty are eligible for a rebate. This rebate is calculated as 87% of the difference between the Bass Strait import parity price and the effective realized price achieved by each producer or exporter. This means that each producer/exporter will be paid a rebate amount based on their specific production and export figures, reflecting the discrepancy between the domestic excise price and the export price received (section 50). The exact rebate amount for each producer/exporter will be determined once the production and export data for the 1983 financial year are available, with an anticipated total rebate of approximately $11 million. The Act imposes certain obligations on the parties involved, including the requirement for producers and exporters to provide detailed information on their production and export activities. This data will be crucial for calculating the rebate amount for each entity. Additionally, the government is obligated to review and adjust the rebate amounts as necessary once the final figures are confirmed, ensuring accuracy in the rebate payments (section 50). Failure to comply with the requirements set out in the Excise Regulations (Amendment) can result in civil or criminal consequences. While specific penalties are not detailed in the explanatory statement, breaches of excise duty regulations can typically lead to fines and other legal actions. The precise penalties would be in accordance with the Excise Act 1901, which includes provisions for both civil penalties and criminal sanctions for non-compliance. Producers and exporters must ensure they adhere to the regulations to avoid any legal repercussions.