Overview

The Fuel Indexation (Road Funding) Special Account Act 2015 was enacted to address the need for dedicated funding for road infrastructure from the additional revenue generated by the indexation of excise and excise equivalent duties on fuels, excluding aviation fuels. This Act was introduced by the Australian Parliament to ensure that the extra net revenue from fuel indexation is allocated specifically for road infrastructure projects. The policy objective of this Act is to credit the Fuel Indexation (Road Funding) special account with amounts equivalent to the net increase in revenue from fuel indexation each financial year, which is then transferred into the COAG Reform Fund to support state and territory investments in road infrastructure. The Act mandates that the Treasurer, in determining the amounts to be credited to the special account, must consider the purpose of ensuring these funds are used for their intended infrastructure purposes. The special account was established to facilitate the transparent and systematic use of fuel indexation revenue for road funding.

Scope and Application

The Fuel Indexation (Road Funding) Special Account Determination 2017 (No. 1) applies to the Treasurer under the provisions of the Fuel Indexation (Road Funding) Special Account Act 2015, which is a Commonwealth Act. This Act aims to ensure that the additional net revenue generated from the introduction of fuel indexation, specifically the indexation of excise and excise equivalent duty on fuels excluding aviation fuels, is allocated towards funding road infrastructure. The Act establishes and governs the operation of the Fuel Indexation (Road Funding) special account, through which these funds are transferred into the COAG Reform Fund to support state and territory investments in Australian road infrastructure. The determination mandates that $275,000,000 be credited to the special account on 1 May 2017, representing the fuel indexation amount for the 2015-16 financial year. This amount is calculated as the net increase in revenue from the introduction of fuel indexation, after accounting for any offsetting increases in tax credits, rebates, and grants resulting from the indexation. The Treasurer is required to determine this amount in writing, taking into account the purpose of the special account as outlined in the Act. Although the determination is a legislative instrument under the Legislation Act 2003, it is exempt from disallowance as per subsection 8(3) of the Act. This minor and mechanical determination, which merely involves the calculation of an amount based on available data, commenced on the day it was registered on the Federal Register of Legislation.

Key Provisions

The Fuel Indexation (Road Funding) Special Account Determination 2017 (No. 1) under the Fuel Indexation (Road Funding) Special Account Act 2015 (the Act) provides for a specified amount to be credited to the special account. Specifically, section 8(1) of the Act empowers the Treasurer to determine, by written instrument, an amount to be credited to the Fuel Indexation (Road Funding) special account (the special account) on a specified day. This determination mandates that $275,000,000 be credited to the special account on 1 May 2017, which corresponds to the fuel indexation amount for the 2015-16 financial year. The Act, through section 9, establishes that the purpose of the special account is to ensure that amounts equal to the fuel indexation amount for a financial year are transferred into the COAG Reform Fund. This fund is intended to support State and Territory expenditure on investment in Australian road infrastructure. The fuel indexation amount, as defined in subsection 9(2) of the Act, generally represents the net increase in revenue resulting from the introduction of fuel indexation, after accounting for any offsetting increases in tax credits, rebates, and grants that also stem from indexation. The obligations imposed by the Act primarily focus on the Treasurer, who is responsible for determining the amount to be credited to the special account. In making this determination, the Treasurer must consider the purpose of the special account as outlined in section 9. This ensures that the special account is used in alignment with its intended purpose of funding road infrastructure through the additional net revenue from fuel indexation. The determination of the credit amount must be consistent with the rules and definitions provided in the Act, ensuring transparency and accountability in the process. The Act does not specify any offences or penalties for non-compliance with its provisions. However, it is important to note that the determination is a legislative instrument under the Legislation Act 2003. Despite this, subsection 8(3) of the Act exempts the determination from disallowance, meaning that once made, the determination is legally effective without the need for parliamentary approval. The determination came into effect on the day it was registered on the Federal Register of Legislation, and no consultation was undertaken due to its minor and mechanical nature, involving only the determination of an amount from available data in accordance with the rules set out in sections 8 and 9 of the Act.