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2008-2009-2010
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
EXCISE TARIFF AMENDMENT (AVIATION FUEL) BILL 2010
CUSTOMS TARIFF AMENDMENT (AVIATION FUEL) BILL 2010
EXPLANATORY MEMORANDUM
(Circulated by authority of the Minister for Infrastructure, Transport,
Regional Development and Local Government
the Honourable Anthony Albanese, MP
and
the Treasurer
the Honourable Wayne Swan MP
and
the Minister for Home Affairs
the Honourable Brendan O'Connor MP)
EXCISE TARIFF AMENDMENT (AVIATION FUEL) BILL 2010
CUSTOMS TARIFF AMENDMENT (AVIATION FUEL) BILL 2010
OUTLINE
Increased Aviation Fuel Excise
The purpose of these Bills is to amend the Excise Tariff Act 1921 and the
Customs Tariff Act 1995 to alter the excise and customs duty applying to
aviation fuel from $0.02854 per litre to $0.03556 per litre from 1 July
2010.
In the May 2010 Budget the Government announced an increase in aviation
safety funding through an increase in the aviation fuel excise to fund
critically important safety activities to be implemented by the Civil
Aviation Safety Authority (CASA), Australia's aviation safety regulator,
and address a long-term shortfall in funding of CASA. These activities
include continued random testing for alcohol and other drugs within the
aviation industry; developing and maintaining safety standards; regulating
expanding areas of aviation activity; and implementing a state safety
program. The increased funding will also enable CASA to strengthen their
technical capability and regulatory oversight ability and expand technical
training capacity for its technical staff.
The increase is $0.00702 per litre. This will translate to an additional
$89.9 million of CASA funding over four years.
Date of Effect: 1 July 2010.
Financial Impact Statement
As per the May 2010 Federal Budget, this measure will result in an
additional $89.9 million for CASA over the four financial years from 1 July
2010 to 30 June 2014.
|Expense ($m) |
| |2009-10 |
|Excise duty rate |
|Item 10.6 of the Schedule|Item 10.6 of the Schedule|
|to the Excise Tariff Act |to the Excise Tariff Act |
|1921 has a rate of |1921 has a rate of |
|$0.03556 per litre. |$0.02854 per litre. |
|Item 10.17 of the |Item 10.17 of the |
|Schedule to the Excise |Schedule to the Excise |
|Tariff Act 1921 has a |Tariff Act 1921 has a |
|rate of |rate of |
|$0.03556 per litre. |$0.02854 per litre. |
|Excise-equivalent customs duty rate |
|Subheadings 2710.11.61, |Subheadings 2710.11.61, |
|2710.91.61 and 2710.99.61|2710.91.61 and 2710.99.61|
|in Schedule 3 to the |in Schedule 3 to the |
|Customs Tariff Act 1995 |Customs Tariff Act 1995 |
|have rates of |have rates of |
|$0.03556 per litre. |$0.02854 per litre. |
|Subheadings 2710.19.40, |Subheadings 2710.19.40, |
|2710.91.40 and 2710.99.40|2710.91.40 and 2710.99.40|
|in Schedule 3 to the |in Schedule 3 to the |
|Customs Tariff Act 1995 |Customs Tariff Act 1995 |
|have rates of |have rates of |
|$0.03556 per litre. |$0.02854 per litre. |
Detailed Explanation of New Laws
1. These Bills seek to legislate the increased rates of aviation fuel
excise and excise-equivalent customs duty.
2. Aviation gasoline for use as fuel in aircraft is classified in item
10.6 and aviation kerosene is classified in item 10.17 of the
Schedule to the Excise Tariff Act 1921.
3. The amendments set out in the Excise Tariff Amendment (Aviation
Fuel) Bill 2010 alters the Schedule to the Excise Tariff Act 1921
to increase the rate applicable under items 10.6 and 10.17 from
$0.02854 per litre to $0.03556 per litre. [Schedule 1, items 1 to
2 of the Excise Tariff Amendment (Aviation Fuel) Bill 2010]
4. Imported aviation gasoline and aviation kerosene are classified
under several subheadings in Schedule 3 to the Customs Tariff Act
1995 (the Customs Tariff). The subheadings that receive equivalent
tax treatment to item 10.6 (aviation gasoline) of the Schedule to
the Excise Tariff Act 1921 are: 2710.11.61, 2710.91.61 and
2710.99.61. The subheadings that receive equivalent tax treatment
to item 10.17 (aviation kerosene) of the Schedule to the Excise
Tariff Act 1921 are: 2710.19.40, 2710.91.40 and 2710.99.40.
5. Additionally, Schedules 5, 6, 7 and 8 to the Customs Tariff specify
rates of duty for certain goods, including aviation fuel, imported
under the Australia-US Free Trade Agreement, the Thai-Australia
Free Trade Agreement, the Australia-Chile Free Trade Agreement and
the ASEAN-Australia-New Zealand Free Trade Agreement, respectively.
The Bill amends the relevant items in these Schedules so that the
increased rates of duty apply to the aviation fuel when imported
under these Free Trade Agreements.
6. Schedule 1 of the Customs Tariff Amendment (Aviation Fuel)
Bill 2010 amends the Customs Tariff to increase customs duty rates
for aviation gasoline and aviation kerosene by $0.00702 per litre,
from $0.02854 to $0.03556 per litre.
7. Additionally, Schedule 3 to the Customs Tariff Act 1995 is altered
by the Customs Tariff Amendment (Aviation Fuel) Bill 2010 so that
the relevant rates of excise-equivalent customs duty accord with
changes to the Schedule to the Excise Tariff Act 1921. [Schedule
1, items 1 to 6 of the Customs Tariff Amendment (Aviation Fuel)
Bill 2010]
8. The Bill also amends rates of duty for the items in Schedules 5, 6,
7 and 8 of the Customs Tariff Act 1995 that correspond to the above
subheadings in Schedule 3. These amendments to the Customs Tariff
Act 1995 ensure that the excise equivalent component of customs
duty on imported aviation fuel is the same as the rates of excise
duty applicable to this product when produced in Australia and will
apply to goods when imported from all countries. [Schedule 1,
items 7 to 30 of the Customs Tariff Amendment (Aviation Fuel) Bill
2010]
Application and transitional provisions
9. In accordance with Section 2 of the Excise Tariff Amendment
(Aviation Fuel) Bill 2010, the excise tariff amendments will
commence on 1 July 2010.
10. The amendments to the Customs Tariff Act 1995 will also commence on
1 July 2010. In addition, the amendments apply to goods entered
for home consumption on or after 1 July 2010 and to goods that have
been imported into Australia before that date where the time for
working out the rate of import duty on the goods had not occurred
before that date. For example, this application provision will
apply to goods that were warehoused on importation before
1 July 2010 and not entered into home consumption until on or after
that date. [Schedule 1, item 31 of the Customs Tariff Amendment
(Aviation Fuel) Bill 2010]