Excise (Volume of Fuels - Temperature Correction) Determination 2009 (No. 1)

Overview

The Excise (Volume of Fuels- Temperature Correction) Determination 2009 (No. 1) was enacted under section 65 of the Excise Act 1901 to address the issue of accurately determining the volume of excisable fuel for the purposes of calculating excise duty, particularly in light of temperature variations that affect fuel density. This legislative instrument was introduced to ensure a standardised approach to the calculation of the volume of fuel at a consistent temperature, specifically 15 degrees Celsius, to facilitate the accurate imposition of excise duty. The instrument was developed following consultations with industry representatives through the Petroleum Corporate Consultative Forum and other direct contacts, which indicated no significant concerns regarding the proposed methods. The determination applies from 1 July 2009 and provides two methods for determining the volume of fuel: one using American Society for Testing and Materials (ASTM) volume correction factors for larger clearances and another allowing for the use of ambient temperature measurements for smaller clearances.

Scope and Application

The Excise (Volume of Fuels- Temperature Correction) Determination 2009 (No. 1) applies to entities that hold an excise licence under the Excise Act 1901 and are engaged in the clearance of transport fuels for home consumption. This includes both major and smaller fuel distributors, depending on their aggregated clearances of transport fuels. The determination specifies the permissible methods for calculating the excisable volume of fuel, with Method 1 applying to entities with aggregated clearances exceeding 50,000 litres per accounting period, and Method 2 available for those with lower clearances. The accounting period for determining aggregated clearances is the same as that used for income tax purposes under the Income Tax Assessment Act 1936. The geographic reach of this legislation is national, as it applies across Australia, and the determination extends the application of the Excise Act by providing detailed rules for the calculation of excise duty on fuel. The determination does not include specific exclusions or exemptions, but it does clarify that once a method is chosen within an accounting period, it cannot be changed. This instrument was made under the authority granted by section 65 of the Excise Act 1901 and came into effect on 1 July 2009.

Key Provisions

The Excise (Volume of Fuels- Temperature Correction) Determination 2009 (No. 1) outlines the rules for determining the volume of excisable fuel at the time of delivery for home consumption, as per section 65 of the Excise Act 1901. This determination is crucial for calculating the excise duty payable on such fuel. Specifically, section 8 mandates that the volume of fuel must be determined using one of the specified methods at the time of delivery. Section 9 states that for establishments with aggregated clearances exceeding 50,000 litres per accounting period, the volume of fuel at ambient temperature must be converted to the volume at 15 degrees Celsius using the American Society for Testing and Materials (ASTM) volume correction factors. Conversely, section 10 allows establishments with clearances of less than 50,000 litres per accounting period to either use the corrected volume at 15 degrees Celsius or the measured volume at ambient temperature. Section 13 stipulates that a person cannot change the method for determining the volume of fuel within an accounting period. The Act imposes several obligations on the parties involved. Under section 8, the volume of fuel must be determined using the specified methods at the time of delivery. Section 9 requires establishments with clearances exceeding 50,000 litres per accounting period to convert the volume of fuel at ambient temperature to the volume at 15 degrees Celsius using ASTM correction factors. Section 10 allows smaller establishments to choose between the corrected volume or the measured volume at ambient temperature. Additionally, section 13 mandates that once a method is chosen for an accounting period, it cannot be changed. Any breach of the provisions outlined in this determination could result in penalties. Although specific penalties are not detailed in the provided text, under the Excise Act 1901, penalties for non-compliance with excise duties can include fines and, in severe cases, criminal prosecution. The exact penalties would depend on the nature and extent of the breach, and would be determined in accordance with the relevant sections of the Excise Act 1901.