2. Fuel schemes
Pauline Zdjelar, National Director Excise Risk and Advice provided an overview of the business as usual operation of fuel tax credits.
Pauline also provided an overview of the outcome of the 2007-08 compliance activities. Pauline explained that the outcomes of this, and a broader risk scan, are being fed into the development of our compliance activities and focus in 2008-09.
2.1 Fuel tax credit business as usual - client demographics
Pauline provided industry, market segment and outlay information on the currently 220,040 businesses registered for fuel tax credits across all industry groups.
Members may request their industry specific information from the secretariat.
2.2 Outcomes of 2006-07 compliance activities - Benchmarking exercise
The principle focus of the Tax Office compliance activities for the whole of fuel tax credits (aside from early payments) was a benchmarking exercise to establish levels of non-compliance within the client base and to identify areas of risk which need to be addressed.
Key findings:
- Levels of revenue leakage and non-compliance are generally very low on a value basis, approximately 1%.
- Principal reasons for non-compliance, and risk, included incorrect calculation, incorrect rate applied, off-road and on-road not correctly apportioned and incorrect claiming of light vehicles off-road.
- A high percentage of businesses that claim a fuel tax credit for diesel used in pre 1996 heavy vehicles travelling on public roads are not complying with the emissions criteria set by the Department of Infrastructure, Transport, Regional Development and Local Government
2.2.1 Non-compliance with emissions criteria data
Number of clients examined
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70
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Number of these with post 1996 vehicles
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39 (56%)
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Number not servicing their vehicles according to guidelines
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17 (24% of total, however 54% of clients with pre-1996 vehicles)
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Examination of the causes of non-compliance revealed:
- low levels of awareness of requirements
- confusion over service intervals
- poor record keeping, and
- a small level of deliberate non-compliance.
The information gathered from the exercise will be used by the Tax Office to work with the Department of Infrastructure, Transport, Regional Development and Local Government (DITRDLG) to improve the quality of the information for clients.
Member comments:
Members commented that they had received feedback from some of their members that they had difficulty in finding the information on the Tax Office website and may not go to the DITRDLG's website. They asked Tax Office and Department of Infrastructure, Transport, Regional Development and Local Government to work together to try and replicate or summarise the information appearing on the DITRDLG website onto the Tax Office website.
Member question:
Members asked how the Tax Office intended to address the levels of non-compliance as they are primarily due to clients not understanding the requirements?
The Tax Office responded that in addition to reviewing published material and working with DITRDLG on the guide it will develop a strategy to address the issues found in the benchmarking exercise.
Action item
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AIO40608/01 - Tax Office to work with DITRDLG to place comprehensive suite of material on Tax Office with site relating to emissions criteria.
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Responsibility
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Claudia Bianco and Christopher Cook (Excise client relations and communications unit).
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Due date:
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Next FSAF phone hook up - 11 September
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Action item
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AIO40608/02 - Develop and implement a strategy to address levels of non-compliance associated with low levels of awareness of requirements to comply with emissions criteria.
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Responsibility
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Pauline Zdjelar/Claudia Bianco
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Due date:
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Next FSAF phone hook up - 11 September
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2.3 Fuel tax credits phase 2
The Tax Office have identified the following risks with the expansion of fuel tax credits:
- the complexities with three different rates and the potential for clients to claim incorrectly
- the impact of the increased client base
- the closure of early payments and transitioning these clients to the BAS
- the potential for fraud, and
- clients registering early for a new entitlement and claiming before 1 July.
2.4 Compliance focus in 2008-09
The risks that the Tax Office have identified both with business as usual fuel tax credits and with the expansion are being addressed through the following compliance strategies:
- Business as usual fuel tax credits:
- claim validation profiling
- on going marketing and education activities for both specific industries - including working with industry associations - and issues, for example heavy road vehicles and compliance with the emissions criteria, and for fuel tax credits in general
- specific case profiles
- benchmarking
- internal reviews
- fraud reviews with the Serious Non Compliance area of the Tax Office
- system checks of claims, and
- advisory visits.
- Fuel tax credits expansion
- These risks are being initially addressed through our communications activities and the Tax Office will be monitoring claiming patterns and behaviours as the system beds down to see if the risks manifest.
- review of early payments closure claims
- reviews of unusual claim patterns, and
- audits.
Action item
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AIO040608/03 - Industry specific information.
The Tax Office offered to work with members to provide industry specific information to incorporate into their products to assist businesses with claiming their entitlements.
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Responsibility
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Tax Office and FSAF members
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Due date:
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As soon as possible
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Sections within Agenda items
Last Modified: Wednesday, 27 June 2012