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EXCISE AMENDMENT REGULATIONS 2000 (NO. 6) 2000 NO. 297EXPLANATORY STATEMENT
STATUTORY RULES 2000 No. 297
Issued by the Authority of the Assistant Treasurer
Excise Act 1901
Excise Amendment Regulations 2000 (No. 6)
Section 164 of the Excise Act 1901 (the Act) provides that the Governor-General may make regulations prescribing matters required to give effect to the Act or for the conduct of any business relating to the excise.
Section 78 of the Act provides that remissions, rebates and refunds of excise duty may be allowed in respect of excisable goods in such circumstances and subject to such conditions and restrictions as are prescribed. Regulation 510 of the Excise Regulations 1925 (the Excise Regulations) prescribes the circumstances in which remissions, rebates and refunds of excise duty may be allowed for the purposes of section 78.
Section 77H of the Act provides that blending of petroleum products is to be treated as manufacture, but that certain prescribed products will be considered to be exempt blended petroleum product. Regulation 176 of the Excise Regulations prescribes the circumstances in which products become exempt for the purposes of section 77.
Purpose of the Regulations
The purpose of the amendments was to:
(a) add a new remission and refund provision to provide access to recycled hydraulic oil, brake fluid, transmission oil, transformer oil and heat transfer oil duty free where such products do not attract a benefit under the Product Stewardship (Oil) Regulations;
(b) exclude products classifiable to Item 15 of the Schedule to the Excise Tariff Act 1921 from the provision contained in Regulation 176(2)(m) which had stipulated that non-fuel blending is an "exempt blend"; and
(c) add three new blending provisions to provide that the following are "exempt blends":
i) duty paid product classifiable to Item 15 blended with other duty paid product classifiable to Item 15;
ii) duty paid product classifiable to Item 15 blended with non-dutiable additives; and
iii) duty paid product classifiable to Item 15 blended with water.
(d) clarify the intent of Excise Regulation 176(2)(f) which deals with two-stroke fuel.
As part of the Measures for a Better Environment, announced by the Prime Minister on 28 May 1999, a decision was made to address the issue of waste oil by means of a product stewardship system.
The Product Stewardship (Oil) Act 2000, and consequential amendments to Excise and Customs legislation, obtained Royal Assent on 6 July 2000.
The amendments to the Excise Act 1901 and the Excise Tariff Act 1921 necessitated consequential excise regulation amendments to bring oil products which are classified to Item 15 of the Schedule 1 to the Excise Tariff Act 1921 into line with other excisable products.
Recycled hydraulic oil, brake fluid, transmission oil, transformer oil and heat transfer oil
Currently, where such oils are recoverable they are already being recycled using relatively simple processes that are analogous to the operation of an oil filter in an engine. This recycling already constitutes good business practice, and consequently, such recycling does not receive a benefit under the Product Stewardship arrangements.
However, consequential amendments to the Excise Regulations were required to ensure that these products were not penalised by being subject to the 5 cent per litre excise levy on oils imposed by Item 15 of the Schedule to the Excise Tariff Act 1921.
The addition of Item 15 to the Schedule to the Excise Tariff Act 1921 has resulted in the requirement for technical consequential amendments relating to non-fuel blending of excisable petroleum product.
These blending amendments provide that product classifiable to Item 15 which has been duty paid may be blended with prescribed non-fuel products without the requirement to pay additional duty or be licensed as an excise manufacturer provided duty is paid on the oil component on the blend at the rate specified.
Regulation 172(2)(f) dealing with two-stroke blends has been amended to clarify that excise is payable at the relevant rates on both the oil and the gasoline component of a two-stroke blend.
The Regulations commence on 1 January 2001.