Fuel tax credits - fuel blends

Clean energy and the carbon charge

From 1 July 2012, under the new clean energy laws, a carbon charge applies to certain taxable fuels, reducing the fuel tax credit rates for these fuels. The carbon charge is an amount equal to the price of carbon emissions from the combustion of liquid and gaseous fuels. The amount of the carbon charge varies for different fuels depending on their carbon emissions.

Fuels and activities not affected by the carbon charge

Fuel tax credit rates will not be reduced by a carbon charge for:

• fuels used in:
• vehicles with a gross vehicle mass (GVM) greater than 4.5 tonnes travelling on a public road
• specified activities in the agriculture, fishing or forestry industries
• activities that do not involve combustion of the fuel - for example, fuel used to clean machinery or as a mould release agent
• renewable fuels such as biodiesel or fuel ethanol.

Carbon charge and fuel blends

The carbon charge affects the fuel tax credit rate for some fuel blends. For more information about fuel tax credit rates, including those affected by a carbon charge, for:

• common blends (invoiced as B5, B20, E10 or E85), refer to Fuel tax credits and common fuel blends
• other blended fuels, refer to Fuel tax credits and other fuel blends.

For a detailed explanation of how the rates are calculated for blended fuels affected by the carbon charge, refer to Full calculation - fuel tax credits for fuel blends affected by the carbon charge.