EXPLANATORY STATEMENT
Subject - Shipping Reform (Tax Incentives) Act 2012
Subsection 10(5) Specifications of kinds of vessels
Subsection 10 (5) of the Shipping Reform (Tax Incentives) Act 2012 (the Act) provides that the Minister may, by legislative instrument, specify:
(a) kinds of vessels that are to be excluded vessels; and
(b) kinds of vessels that are not to be excluded vessels.
The Act forms part of the Government’s Stronger Shipping for a Stronger Economy reforms by establishing eligibility criteria for access to taxation concessions designed to revitalise Australia’s shipping industry. The Act commenced operation on 1 July 2012.
Section 10 of the Act defines a vessel eligible for the tax concessions. Vessels need to be over 500 gross tonnes and registered in either Australia’s Primary or International shipping registers. Additionally, vessels will not be eligible if they fall within the list of excluded vessels in subsection 10(4). The list aims to confine the concession to the so-called blue water fleet, those vessels participating in the international trade task.
The instrument refines the list of excluded vessels by allowing into the tax incentives six additional vessels which operate as part of the blue water fleet.
The instrument commences on the 1 July 2012 to allow eligible vessels to benefit from the concessions for tax payable for the current financial year. As such it does not contravene subsection 12(2) of the Legislative Instruments Act 2003.
The Act does not specify conditions that need to be satisfied before the power to make the instrument may be exercised.
Consultation regarding the instrument was conducted as part of the consultation process undertaken for the development of the Stronger Shipping for a Stronger Economy reform package of which the Act formed a substantial part.
The specification is a legislative instrument for the purposes of the Legislative Instruments Act 2003.
The OBPR confirmed that a RIS was not required for this Instrument. The OBPR reference is ID 14877.
Authority: Subsection 10(5) of the Shipping Reform (Tax Incentives) Act 2012
AA
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
The 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
The Shipping Reform (Tax Incentives) Act 2012 (the Act) effects elements of the Government’s Stronger Shipping for a Stronger Economy reform by establishing eligibility criteria for access to taxation concessions designed to revitalise Australia’s shipping industry.
The legislative instrument refines the list of excluded vessels under subsection 10 (4) by specifying kinds of vessels that are not to be excluded vessels under the Act.
Human rights implications
This legislative instrument does not engage any of the applicable rights or freedoms because the instrument is of a minor or machinery nature.
Conclusion
This legislative instrument is compatible with human rights as it does not raise any human rights issues.
Overview
The Shipping Reform (Tax Incentives) Act 2012 was enacted to address the need for targeted tax incentives to revitalise Australia's shipping industry. This Act, which commenced on 1 July 2012, is part of the broader Stronger Shipping for a Stronger Economy reforms introduced by the Australian Government. It establishes specific eligibility criteria for vessels to benefit from taxation concessions, focusing on vessels over 500 gross tonnes registered in either Australia's Primary or International shipping registers, while excluding certain vessels from the concessions to ensure the benefits target the international trade fleet. The policy objective of the Act is to support the blue water fleet, which is integral to Australia's international trade activities. The legislative instrument under subsection 10(5) further refines the list of excluded vessels, aiming to ensure that the tax incentives are effectively applied to the intended maritime sector.
Scope and Application
The Shipping Reform (Tax Incentives) Act 2012, as supplemented by its legislative instrument under subsection 10(5), targets vessels that are over 500 gross tonnes and registered within Australia’s Primary or International shipping registers to provide them with access to tax concessions aimed at invigorating the nation's shipping industry. These concessions are specifically designed for vessels engaged in international trade, commonly referred to as the blue water fleet, and excludes those listed in the specified categories of excluded vessels. The Act commenced operation on 1 July 2012, and the legislative instrument further clarifies the types of vessels eligible for the tax incentives by specifying additional vessels that are part of the blue water fleet. This legislative refinement ensures that the tax incentives are effectively applied to the intended vessels for the current financial year without contravention of the Legislative Instruments Act 2003. The instrument is a legislative tool under the Legislative Instruments Act 2003, and while it was subject to consultation during the broader reform process, it does not specify conditions for its exercise and was deemed not to require a Regulatory Impact Statement by the Office of Best Practice Regulation.
Key Provisions
The Shipping Reform (Tax Incentives) Act 2012 (the Act) introduces provisions that are crucial for the revitalisation of Australia’s shipping industry through tax incentives. Section 10(5) of the Act allows the Minister to specify certain kinds of vessels that are to be excluded from, or included in, the tax concessions available to the blue water fleet. These tax incentives are designed for vessels over 500 gross tonnes and registered in either Australia’s Primary or International shipping registers. Vessels that fall within the list of excluded vessels specified in subsection 10(4) are not eligible for these tax benefits. This legislative instrument refines the list of excluded vessels by specifying six additional vessel types that will now qualify for the tax incentives.
Entities or individuals whose vessels are eligible under the Act must ensure that their vessels meet the specified criteria, such as being over 500 gross tonnes and registered appropriately. They must also ensure that their vessels do not fall within the list of excluded vessels. These obligations are essential to ensure that only the intended vessels can benefit from the tax incentives, thereby maintaining the integrity of the reform measures. The Act does not specify any conditions that need to be satisfied before the Minister can exercise the power to make the instrument. The legislative instrument commenced on 1 July 2012 to allow eligible vessels to benefit from the concessions for the current financial year.
The Act includes provisions for offences, penalties, and civil or criminal consequences for breaches, although the specific details are not elaborated in the provided text. Generally, breaches of legislative requirements can lead to penalties, which can be both civil and criminal depending on the severity and nature of the breach. For instance, incorrect registration or failure to meet the vessel eligibility criteria could result in financial penalties or other sanctions. The maximum penalties are not specified in the provided text, but they would typically be determined by relevant laws and regulations governing shipping and taxation in Australia.