Notice of Substituted Rates of Excise Duty Notice No. 2 (2026)

Overview

The Excise Tariff Act 1921 was enacted to provide for the imposition of excise duties on specified goods, including tobacco products, and to set out the rates of such duties. The Act was introduced to address the need for a structured and regulated approach to taxation on goods that are often subject to significant consumption within Australia. This Act empowers the Commissioner of Taxation to adjust the rates of excise duties on certain goods as required, ensuring that the taxation framework remains responsive to economic conditions and policy objectives. The policy objective, as stated within the Act, is to manage the fiscal impact of excise duties on specific goods while also addressing public health and social concerns related to the consumption of such products. This legislation was enacted by the Australian Parliament, reflecting the federal nature of the taxation system in Australia. The 2026 Notice of Substituted Rates of Excise Duty is issued under the authority delegated to the Commissioner of Taxation, providing a formal mechanism for updating the rates of excise duty as necessary to meet current economic and policy objectives. This ensures that the excise system remains effective in generating revenue and influencing consumer behaviour in line with broader governmental goals.

Scope and Application

The Excise Tariff Act 1921 applies to any goods subject to excise duty as classified within the various items and subitems listed in the Schedule of the Act. This Act pertains to the excise duties imposed on a range of goods, including tobacco products, and applies across the Commonwealth of Australia, thereby affecting all entities and individuals engaged in the manufacture, importation, or supply of these goods within Australia. The Act sets forth the rates of excise duty applicable to these goods, which can be altered or substituted through notices issued by a delegate of the Commissioner of Taxation, as exemplified in the Notice No. 2 (2026) provided. This notice specifies new excise duty rates for certain tobacco products, effective from 3 March 2026, reflecting changes intended to update the fiscal impact and regulatory framework governing these goods. The Act’s application is comprehensive, covering all taxable goods within its jurisdiction without explicit exclusions, unless otherwise specified by subordinate instruments or regulations.

Key Provisions

The Excise Tariff Act 1921 (Tariff Act) provides mechanisms for adjusting the rates of excise duty on various goods through notices issued by a delegate of the Commissioner of Taxation. Section 6AA(11) and 6AAB(9) of the Act allow for the substitution of rates of excise duty by way of a notice. In Notice No. 2 (2026), issued on 26 February 2026, Anthony Siouclis, the delegate of the Commissioner of Taxation, announced new excise duty rates for goods starting from 3 March 2026. This notice details the substituted rates for specific excise tariff items listed in the accompanying table, which provides clarity on the new rates for each specified item. Under the Excise Tariff Act, the delegate of the Commissioner of Taxation is responsible for publishing notices that adjust the excise duty rates. This responsibility includes ensuring that the updated rates are clearly communicated and that the changes take effect on the specified date. The obligation on the delegate is to follow the legislative framework provided by sections 6AA(11) and 6AAB(9) to make these announcements, which are binding and enforceable from the date they are issued. The Excise Tariff Act 1921 imposes specific obligations on entities and individuals subject to excise duty. These entities must comply with the new rates as stipulated in the notice, ensuring that the appropriate excise duty is applied to the goods from the effective date. Failure to adhere to the new rates could result in non-compliance with the Act, potentially leading to legal consequences. The Act also mandates that businesses maintain accurate records of excise duty paid and adjust their practices to reflect the new rates. In cases of non-compliance or evasion of the new excise duty rates, the Excise Tariff Act 1921 imposes penalties. The maximum penalties for breaches can include fines and, in some cases, imprisonment. The specific penalties depend on the nature and severity of the breach. For instance, wilful or negligent breaches could attract higher fines, while repeated or serious offences might lead to more severe criminal penalties. It is imperative for businesses to understand and comply with the new rates to avoid these potential consequences.