Excise Tariff Regulations 2022

Administered by Department of the Treasury

Legislation au F2022L00491 Regulations In force Legislative Instrument

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EXPLANATORY STATEMENT

Issued by authority of the Assistant Treasurer, Minister for Housing and Minister for Homelessness, Social and Community Housing

Excise Tariff Act 1921

Excise Tariff Regulations 2022

The purpose of the Excise Tariff Act 1921 (the Excise Tariff Act) is to impose excise duty on a range of goods, including excise liability on the volume of condensate and oil produced from onshore and offshore areas. Section 7 of the Excise Tariff Act provides that the Governor-General may make regulations prescribing matters required or permitted by that Act to be prescribed.

The purpose of the Excise Tariff Regulations 2022 (the Regulations) is to prescribe the inclusion of two additional condensate reservoirs, the Greater Western Flank-2 and Persephone, as part of the existing prescribed condensate production area, the Rankin Trend as defined under subsection 6CA(1B) of the Excise Tariff Act.

Subsection 6CA(1B) of the Excise Tariff Act outlines the statutory definition of ‘Rankin Trend’. The Rankin Trend is located within the North West Shelf project area situated off the coast of Western Australia and encompasses multiple spatially related reservoirs. Subsection 6CA(1B) of the Excise Tariff Act prescribes the Rankin Trend as a single condensate production area based on the determination from Geoscience Australia that the Rankin Trend reservoirs formed a single field. Paragraph 6CA(1B)(b) of the Excise Tariff Act enables additional reservoirs to be added to the Rankin Trend through regulations where the Resources Minister has expressed satisfaction that further reservoirs form part of the same field as a reservoir or groups of reservoirs within the Rankin Trend under subsection 6CA(1C) of the Excise Tariff Act. The Resources Minister has expressed this view in respect of both the Greater Western Flank‑2 and Persephone reservoirs. Therefore, the Regulations prescribe that the Greater Western Flank‑2 and Persephone reservoirs are included within the condensate production area known as the Rankin Trend.

Section 5 of the Regulations prescribes the Greater Western Flank‑2 and Persephone reservoirs to be included as part of the Rankin Trend condensate production area as defined in subsection 6CA(1B) of the Excise Tariff Act.

Including the Greater Western Flank-2 and Persephone reservoirs as part of the existing Rankin Trend area has the effect of contributing to the cumulative total of condensate produced from the Rankin Trend from the dates that the reservoirs commenced production. The first date of production from the Persephone reservoirs was 30 July 2017. The Greater Western Flank-2 reservoirs commenced production on 25 October 2018. The amendments are to apply from the first date of production for each reservoir due to the Rankin Trend excise-free threshold being exceeded. Retrospective application is required due to production from the reservoirs contributing to the total cumulative production levels within the Rankin Trend field, ultimately impacting the amount of excise payable.

Subsection 12(2) of the Legislation Act 2003, which limits the application of retrospective legislative instruments to the extent that it disadvantages a person, does not apply in respect of prescribing additional reservoirs within the Rankin Trend. This is due to the operation of subsection 6CA(1D) of the Excise Tariff Act that allows regulations to have the effect of retrospective application when adding a reservoir or group of reservoirs to the Rankin Trend. Prescribing the Greater Western Flank‑2 and Persephone reservoirs retrospectively does not make a person liable to an offence or civil penalty, rather the amendments allow the correct amount of excise duty to be calculated and collected. This is consistent with the purpose of the Excise Tariff Amendment (Condensate) Act 2011 (Condensate Amendment Act) which implemented retrospective application and enabled excise duty to apply from a date before regulations are made.

Retrospective application is required to ensure that excise is payable on the total cumulative production from the Rankin Trend. The excise duty liability that has accrued from previous years from the Greater Western Flank-2 and Persephone reservoirs will be payable from the financial year commencing 1 July 2022.

Public consultation was not undertaken on the Regulations as the amendments only impact one production license holder. The production license holder is aware of these amendments from the Resources Minister’s decision in September 2021 and was consulted on the Regulations. The Australian Taxation Office and the Department of Industry, Science, Energy and Resources have been consulted throughout the development of this measure.

The Office of Best Practice Regulation has been consulted and advised the amendments are estimated to have a minor impact on compliance costs. Therefore, the preparation of a Regulation Impact Statement is not required (OBPR ID OBPR22‑01879).

The Excise Tariff Act does not specify any conditions that need to be met before the power to make the Regulations may be exercised.

Details of the Regulations are set out in Attachment A.

The Regulations are a legislative instrument for the purposes of the Legislation Act 2003. This Legislative Instrument is subject to sunsetting by the operation of section 50 of the Legislation Act 2003.

The Regulations commence on 1 July 2022.


ATTACHMENT

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Excise Tariff Regulations 2022

This Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Overview of the Legislative Instrument

The purpose of the Excise Tariff Regulations 2022 is to prescribe newly discovered condensate production areas. Two recently discovered reservoirs, the Greater Western Flank-2 and Persephone, are included under the existing prescribed condensate production area, the Rankin Trend as defined under subsection 6CA(1B) of the Excise Tariff Act.

Human rights implications

This Legislative Instrument does not apply to individuals and only relates to corporations and therefore does not engage any of the applicable rights or freedoms.

Conclusion

This Legislative Instrument is compatible with human rights as it does not raise any human rights issues.

 

Overview

The Excise Tariff Regulations 2022 were enacted under the authority of the Assistant Treasurer, Minister for Housing and Minister for Homelessness, Social and Community Housing. These regulations amend the Excise Tariff Act 1921 by incorporating two new condensate reservoirs, the Greater Western Flank-2 and Persephone, into the existing prescribed condensate production area, the Rankin Trend. The Excise Tariff Act 1921 was originally enacted to impose excise duties on various goods, including condensate and oil produced from onshore and offshore areas. The Excise Tariff Regulations 2022 address a specific legislative gap by including new reservoirs into the Rankin Trend, thereby ensuring that the cumulative total of condensate produced from the area is accurately accounted for in terms of excise duty. This ensures that the correct amount of excise is calculated and collected, consistent with the policy objectives of the Excise Tariff Amendment (Condensate) Act 2011. The amendments apply retrospectively to the dates that the new reservoirs commenced production, as required by the relevant provisions of the Excise Tariff Act.

Scope and Application

The Excise Tariff Act 1921, along with the Excise Tariff Regulations 2022, applies to the imposition of excise duty on goods, specifically focusing on the volume of condensate and oil produced from onshore and offshore areas. The Act is applicable to entities engaged in the production of condensate and oil within the prescribed areas, including the newly defined Rankin Trend which now encompasses the Greater Western Flank-2 and Persephone reservoirs. The Regulations extend the application of the Act by incorporating these new reservoirs into the existing production area, thereby impacting the calculation of cumulative production levels and the corresponding excise duty. The regulations apply from the commencement dates of production for the Greater Western Flank-2 and Persephone reservoirs, necessitating retrospective application to accurately reflect the total production and excise liability. Although the Excise Tariff Act does not specify conditions for exercising the power to make the Regulations, the inclusion of new reservoirs is based on the satisfaction of the Resources Minister that these reservoirs form part of the same field as the existing Rankin Trend. This legislative framework is confined to corporations involved in condensate and oil production within Australia, with no direct implications for individual human rights as it does not engage with personal freedoms or rights.

Key Provisions

The Excise Tariff Act 1921 (the Excise Tariff Act) and the Excise Tariff Regulations 2022 (the Regulations) work together to impose excise duty on certain goods, including the volume of condensate and oil produced from onshore and offshore areas. The Excise Tariff Act allows the Governor-General to make regulations (Section 7) to prescribe matters required or permitted by the Act. Specifically, Section 5 of the Regulations includes two additional condensate reservoirs, the Greater Western Flank-2 and Persephone, within the existing prescribed condensate production area, the Rankin Trend. This inclusion is based on the determination by the Resources Minister that these reservoirs form part of the same field as existing reservoirs within the Rankin Trend, as defined in subsection 6CA(1B) of the Excise Tariff Act. The Regulations impose specific obligations on entities involved in the production of condensate within the Rankin Trend. Once the Greater Western Flank-2 and Persephone reservoirs are included in the Rankin Trend, any entity producing condensate from these reservoirs must comply with the excise duty requirements set forth in the Excise Tariff Act. This includes reporting the volume of condensate produced and ensuring that the correct amount of excise duty is calculated and paid. The amendments apply retrospectively from the dates that production from the Persephone and Greater Western Flank-2 reservoirs began, which were 30 July 2017 and 25 October 2018, respectively. This retrospective application is necessary to ensure that the total cumulative production from the Rankin Trend is correctly assessed for excise duty. There are no specific offences, penalties, or civil/criminal consequences outlined for breach of the Excise Tariff Regulations 2022. However, failure to comply with the excise duty requirements under the Excise Tariff Act could result in general penalties, including fines and potential legal action for non-compliance. The Excise Tariff Act does not specify particular penalties for the Regulations but adheres to the broader legislative framework governing excise duty compliance in Australia. The Regulations ensure that the correct amount of excise duty is collected, thus maintaining the integrity of the tax system and ensuring that all relevant production within the Rankin Trend field is appropriately taxed.

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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.