Richard Colbeck (Tasmania, Liberal Party, Parliamentary Secretary to the Minister for Finance and Administration) Share this | Hansard source

On your first question, out until 2010 biodiesel does enjoy an advantage over petrodiesel, to use that term. The differences between the prices that you have mentioned in the tables that you have from 2006 and 2007 are because at this point in time biodiesel—B49 in particular but also B20—is enjoying an unintended subsidy from the tax system. This is in relation to the B49 off-road example, where there is excise being claimed off. It comes back again to the definition of ‘diesel’ which you mentioned before.

You mentioned in your presentation a five per cent threshold. There is no percentage mentioned in the diesel standard. It relates to the description of diesel, although five per cent is probably about the mark of where the threshold and impact on the description of diesel comes in. Again, this comes back to one of the key arguments in relation to this whole piece of legislation and its impacts. There has been an unintended subsidy, through the development of B49, that that particular product has enjoyed because of the capacity to claim a tax rebate for that 49 per cent of diesel where excise has not been paid.