2023–24 fuel tax credits gap estimate
Our latest estimates show that for 2023–24, the overall net fuel tax credit gap is estimated to be $345 million or 3.7%. This means that over 96% of fuel tax credits were claimed correctly, reflecting a system that is operating strongly with taxpayers aware of, and claiming, their correct entitlements.
A gap of 3.7% means overclaims have exceeded underclaims. This means some taxpayers who are entitled to receive credits have not claimed all of them, while others have claimed more than they are entitled to.
Overclaiming
The fuel tax credits gap appears to have stabilised since reaching a peak in 2021-22. The overclaims during this period were largely due to either:
- claiming for an ineligible activity*
- being unaware, or ignoring, the temporary rate decrease in 2021–22.
* Claiming for an ineligible activity includes incorrect claims driven by an increase in the use of global positioning system (GPS) or telematics technologies to determine boundaries between off-road activities and road transport. The data assumptions made, and the methodologies used are, on occasion, not sufficiently accurate to determine the boundaries accurately, leading to overclaims.
We continue to see fraud attempts on ATO systems. There has been a gradual downward trend in these attempts in the last 2 financial years. We have refined our risk models to ensure improved detection.
Underclaiming fuel tax credits
Underclaiming is likely due to:
- being unaware of their eligibility to claim
- conservative estimates
- perceived complexity
- being unaware of rate increases.
Compare the 2023–24 gap with trends from previous years
Table 1 shows the fuel tax credits claims, compliance, and gross and net fuel tax credits gap estimates for the period 2018–19 to 2023–24.
|
Element |
2018–19 |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
|---|---|---|---|---|---|---|
|
Credit payments ($m) |
7,196 |
7,420 |
7,554 |
7,012 |
7,809 |
9,691 |
|
Gross gap ($m) |
197 |
166 |
174 |
459 |
321 |
370 |
|
Amendments ($m) |
11 |
8 |
5 |
104 |
31 |
25 |
|
Net gap ($m) |
186 |
158 |
169 |
354 |
290 |
345 |
|
Gross gap (%) |
2.8% |
2.3% |
2.4% |
7.0% |
4.3% |
4.0% |
|
Net gap (%) |
2.7% |
2.2% |
2.3% |
5.4% |
3.9% |
3.7% |
Figure 1 shows the trend by percentage.
Figure 1: Fuel tax credits gross and net gap percentages, 2018–19 to 2023–24
For previously published tax gap figures, see Australian Tax Gaps - Data.gov.auOpens in a new window