Notice of Substituted Rates of Excise Duty - Notice No. 4 (2018)

Overview

The Excise Tariff Act 1921 was enacted to provide for the imposition of excise duties on certain goods, particularly those outlined in the Schedule of the Act. This Act was introduced to address the need for a structured and legal framework to impose excise duties, ensuring that certain goods are taxed appropriately in accordance with the legislative requirements. The Excise Tariff Amendment (Tobacco) Act 2016 further amended the Excise Tariff Act 1921 to update the excise duties on tobacco products, reflecting policy changes aimed at regulating tobacco consumption and generating revenue. The policy objective, as stated in the notice, is to substitute the rates of excise duty on specified tobacco products, effective from 1 September 2018, as authorised under the Excise Tariff Act 1921. This legislative measure was issued by Andrew McIver, acting as a delegate of the Commissioner of Taxation, to implement the updated rates of excise duty in alignment with the legislative framework established by the Excise Tariff Act 1921 and its subsequent amendments.

Scope and Application

The Excise Tariff Act 1921 governs the imposition of excise duty on various goods within Australia. This particular legislation applies to goods specified in the Schedule of the Act, where the rates of excise duty are outlined. The notice issued under this Act, specifically Notice No. 4 (2018), pertains to the substituted rates of excise duty for goods classified under certain items in the Schedule. For instance, it sets out a new rate for goods classified under items 5.1 and 5.5, which pertain to tobacco products. The new rates are effective from 1 September 2018 and are applied nationally across Australia. This notice, issued by a delegate of the Commissioner of Taxation, adjusts the previously established rates in accordance with the Excise Tariff Amendment (Tobacco) Act 2016. The notice specifies exclusions and modifications to duty rates for certain tobacco products, illustrating the Act’s ability to adapt through subordinate instruments to meet policy objectives.

Key Provisions

The Excise Tariff Act 1921, as amended by the Excise Tariff Amendment (Tobacco) Act 2016, includes a mechanism through which the delegate of the Commissioner of Taxation can announce changes to the rates of excise duty on specific goods, in this case tobacco products. Section 6AA and 6AAB of the Tariff Act empower the delegate to issue a notice, such as NOTICE No. 4 (2018), specifying the new rates of excise duty effective from a designated date. In this particular notice, the substituted rates of excise duty for goods classified under items 5.1 and 5.5 of the Schedule to the Tariff Act are set at $0.80726 per stick for item 5.1 and $1,076.35 per kilogram of tobacco content for item 5.5, effective from 1 September 2018. Under the Excise Tariff Act 1921, the obligations imposed on parties or entities governed by the Act include adherence to the specified excise duty rates. For instance, manufacturers, importers, and retailers of tobacco products must comply with the new rates set out in the notice. This means that from the effective date of the notice, any sales or transactions involving tobacco products classified under items 5.1 and 5.5 must be subject to the new excise duty rates. Failure to do so could result in non-compliance with the Act. The Excise Tariff Act 1921 does not explicitly outline specific offences, penalties, or civil and criminal consequences for breaches of the Act within the notice itself. However, breaches of excise duty regulations generally can lead to various penalties. Under the Excise Act 1901, penalties for non-compliance can include fines, imprisonment, or both, depending on the severity and intent behind the breach. For example, contravening excise duty obligations can result in fines up to 10,000 penalty units ($1.7 million as of 2023) for individuals and higher for corporations, along with potential imprisonment for up to five years. Additionally, the Act may provide for the recovery of unpaid excise duties and interest, as well as legal proceedings to enforce compliance. In summary, NOTICE No. 4 (2018) under the Excise Tariff Act 1921 sets out the new excise duty rates for tobacco products from 1 September 2018, placing an obligation on relevant parties to comply with these rates. Non-compliance with the Act can lead to significant penalties, including substantial fines and potential imprisonment, reflecting the seriousness with which the Australian government treats excise duty regulations.