Peter Slipper (Fisher, Liberal Party) Share this | Hansard source

The cognate bills being debated here today will bring a raft of changes in the areas of excises and tariffs. The Excise Laws Amendment (Fuel Tax Reform and Other Measures) Bill 2006 and the Excise Tariff Amendment (Fuel Tax Reform and Other Measures) Bill 2006 together will introduce measures that will bring excise relief to a wide range of Australian businesses and to householders in general. This area has been somewhat hindered by a lack of consistency in the excise provisions affecting certain fuels.

The changes include that from 2012 all fuels used off-road for business purposes will become excise neutral. Excise paid on fuel used in currently ineligible off-road business activities will be subject to a 50 per cent excise credit from 2008 to 2012, to be increased to a 100 per cent credit from 2012 onwards. Also, excise relief will be extended to all off-road business activities including previously ineligible activities in the manufacturing, construction and quarrying industries. These provisions will, for the first time, extend to utilities and motorcycles used off-road for business purposes.

The provisions of the Excise Laws Amendment (Fuel Tax Reform and Other Measures) Bill will also extend to those fuels purchased by both business and private users, meaning fuels used for the generation of electricity and those used for the generation of heat, such as kerosene, will also be excise free. This improved and more consistent arrangement will come about through the introduction of a fuel tax credit system. The tax credit will be able to be introduced through the business owner’s regular business activity statement. 

I have been approached by a number of constituents who are concerned about this new arrangement, and in particular I refer to trawler operators who operate from Mooloolaba on the Sunshine Coast in my electorate of Fisher. The fishing industry is particularly important. In Mooloolaba we actually have a lot of product being landed and, given the fact that there have been concerns over the sustainability of the fishing industry, increasingly it is necessary for fishermen to go further afield to obtain an appropriate catch. They are big users of fuel and clearly are at the coalface when any changes are mooted. Previously, their fuel supplier was able to sell them the fuel minus excise and then the supplier would claim the fuel credit. The fishermen will now have to pay full price and claim the credit through their regular tax statements. This new arrangement is similar to those in other industries. I have made representations to the minister’s office in relation to this and the minister has advised:

Currently, under the Energy Grants (Credit) Scheme (EGCS) fishers can authorise a third party to make and/or receive grant claims on their behalf. These arrangements are known as the ‘sales to the fishing industry’ arrangements. These allow fishers to enter into an arrangement with fuel suppliers whereby the fuel supplier claims a grant under the EGCS on behalf of the fisher and sells the fuel to the fisher at the price excusive of tax.

Under the fuel tax credit system, fishers will pay the excise on their diesel but will then be able to claim a credit for the amount of the excise on their monthly or quarterly business activity statement.

When one initially looks at this, one might be disposed to say that the new situation does not seem unreasonable. However, the point that has been compellingly made to me by these constituents is that this is going to place an incredible disadvantage on these industries insofar as they will not have the cash arrangements to make the payments as required. In fact, it is going to present major problems for the fishing industry, and numbers of these fishermen have told me that if this change proceeds then they could well be put out of business.

It is going to have a very adverse impact on their business’s cash flow. This industry is particularly important to the Sunshine Coast and I would hope that the government is able to look at this matter. I am sure that it is an unintended consequence—I am sure that the government did not intend to force the fishermen at Mooloolaba out of business. Representations have been made to the government. We will have to wait and see, but I hope that the government is able to address the concerns, quite reasonably expressed, by my constituents at Mooloolaba. I suspect that other honourable members might well have had representations from their constituents, and I can see the honourable member for Page nodding—obviously his fishermen are similarly affected.

The Excise Tariff Amendment (Fuel Tax Reform and Other Measures) Bill 2006 helps to simplify the various taxation implements that are applicable to various types of fuel. The bill removes the various fuel tax provisions and replaces them with just two rates. One of those new rates is applicable only to aviation fuels and the other rate applies to other fuels.

The Customs Amendment (Fuel Tax Reform and Other Measures) Bill 2006 and the Customs Tariff Amendment (Fuel Tax Reform and Other Measures) Bill 2006 accompany the previous two bills. These bills have the purpose of amending the Customs Act 1901 to improve the measures available to Customs to control specific goods that are imported and used in the manufacture of goods that are subject to excise. This means that the excise that is currently payable on goods that are used in Australia to manufacture goods that are excisable will be removed. This excise liability is removed as a result of the good itself being used to create other excise liabilities. These two bills will also remove the penalty provisions applicable to Customs’ operations of the fuel surcharge legislation. This means that imported fuels will be treated in the same way as locally produced fuels in relation to excise. The bills will also reintroduce certain provisions of the Spirits Act 1906, which will be repealed.

The changes outlined come about largely as a result of a review of excise provisions for a range of items including specific alcohol products, petroleum products and tobacco products. The review identified a number of redundant and unnecessarily complex provisions in our excise schedules and these bills enable the new excise schedules to be introduced.

These are important bills, but I would strongly urge the government to take on board the concerns of my constituents in Mooloolaba with a view to enabling them to continue their industry and to continue in business. I would hope that the concerns I have expressed will indeed be addressed by the government.

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