Christine Milne (Tasmania, Australian Greens) Share this | Link to this | Hansard source

I rise to move the Australian Greens' amendment. As I indicated in my speech during the second reading debate, this amendment relates to schedule 4, which provides for the fuel tax rebates to the mining sector. In particular, it is at the end of section 41-5 to add:

Mining or quarrying operations on or after 10 November 2014

(4) Subsection (1) does not apply to taxable fuel that you acquire or manufacture in, or import into, Australia on or after 10 November 2014, to the extent that you do so for use in *carrying on your *enterprise of mining and quarrying operations (within the meaning of the Income Tax Assessment Act 1997).

That would effectively remove the provision of the rebate applying to the mining industry, as I indicated in my speech. I so move:

(1) Schedule 4, page 26 (before line 4), before item 1, insert:

1A At the end of section 41 -5

  Add:

Mining or quarrying operations on or after 10 November 2014

(4) Subsection (1) does not apply to taxable fuel that you acquire or manufacture in, or import into, Australia on or after 10 November 2014, to the extent that you do so for use in *carrying on your *enterprise of mining and quarrying operations (within the meaning of the Income Tax Assessment Act 1997).

Doug Cameron (NSW, Australian Labor Party, Shadow Minister for Human Services) Share this | Link to this | Hansard source

Labor does not support the Greens' amendment. Carving out particular industries will distort the fuel tax credit system that provides for a rebate on fuel where it is used as a business input.

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

The government thanks the opposition for the bipartisan approach that they have taken to this particular issue. It has long been the case that firms and individuals have been exempted from fuel tax—since the 1950s in fact—for off-road use. This recognised at the time that the excise was to be set aside for road construction and maintenance and mining firms were eligible for the exemption. Under current arrangements, generally all fuels used off-road for all business purposes are effectively free of fuel tax. Firms and individuals who run a business—whether manufacturing, construction, primary production, mining or commercial power generation—are able to remove the incidence of tax on a crucial input. This approach avoids destroying business investment decisions and behaviour that would occur if these business inputs were taxed. Denying mining and quarrying businesses access to the fuel tax credits would have a major impact and distort investment decisions in this sector, leading to increased production costs, which could lead to the closure of some mines.

The CHAIRMAN: The question is that Australian Greens amendment (1) on sheet 7627 be agreed to.