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  • Gaseous fuels

    Gaseous fuels are:

    • liquefied petroleum gas (LPG)
    • liquefied natural gas (LNG)
    • compressed natural gas (CNG).

    Excise duty applies to transport gaseous fuels that are delivered out of a licensed excise manufacturing or storage premises and into the Australian domestic market. Delivery into the Australian domestic market also occurs when gaseous fuels are used at the licensed premises.

    Transport gaseous fuels are subject to excise duty and include:

    • LPG or LNG intended for use in an internal combustion engine of a motor vehicle or vessel, either directly or by filling another tank connected to such an engine
    • CNG for use as a fuel in a motor vehicle – excluding CNG compressed at a residential premises using equipment capable of compression at a rate not more than 10 kilograms of natural gas per hour and not for sale
    • all gaseous fuels for mixed use (that is, both transport and non-transport use) or where the end use is unknown.

    Non-transport gaseous fuels are not subject to excise and include:

    • LPG and LNG delivered only for use other than in an internal combustion engine of a motor vehicle or vessel – for example, residential heating or burner applications – or for use in forklifts
    • CNG imported or compressed only for use in forklifts or not for use as a fuel in a motor vehicle
    • CNG compressed at a residential premises (including for use in a motor vehicle) using equipment capable of compression at a rate not more than 10 kilograms of natural gas per hour and not for sale.

    You cannot use or supply non-transport gaseous fuels for a transport use.

    A full automatic remission removes the liability for excise or customs duty from non-transport LPG and LNG. An exemption from excise duty applies for all non-transport CNG as the fuel is not subject to excise duty.

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    Last modified: 04 Jan 2016QC 47681