ATO Interpretative Decision

ATO ID 2003/578 (Withdrawn)

Excise

Diesel Fuel Rebate Scheme: Definition of diesel fuel - blend of diesel and ethanol
FOI status: may be released

This ATO ID is withdrawn from the database because it contains a view in respect of the diesel fuel rebate provisions of the Excise Act 1901 and or the Customs Act 1901 that were repealed with effect from 1 July 2003. Despite its withdrawal from the database, this ATO ID continues to be a precedential view in respect of decisions for fuel purchased before 1 July 2003.

This document incorporates revisions made since original publication. View its history and amending notices, if applicable.

CAUTION: This is an edited and summarised record of a Tax Office decision. This record is not published as a form of advice. It is being made available for your inspection to meet FOI requirements, because it may be used by an officer in making another decision.

This ATOID provides you with the following level of protection:

If you reasonably apply this decision in good faith to your own circumstances (which are not materially different from those described in the decision), and the decision is later found to be incorrect you will not be liable to pay any penalty or interest. However, you will be required to pay any underpaid tax (or repay any over-claimed credit, grant or benefit), provided the time limits under the law allow it. If you do intend to apply this decision to your own circumstances, you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed. You may wish to obtain further advice from the Tax Office or from a professional adviser.

Issue

Does a blend of diesel fuel and ethanol constitute 'diesel fuel' as defined in subsection 4(1) of the Excise Act 1901 for the purposes of the Diesel Fuel Rebate Scheme (the Off Road Scheme)?

Decision

Yes. A blend of diesel fuel and ethanol is 'diesel fuel' as defined in subsection 4(1) of the Excise Act for the purposes of the Off Road Scheme.

Facts

After 17 September 2002, the applicant purchased a blend of diesel and ethanol.

Excise Duty has been paid by the manufacturer of the blended fuel on the individual constituents in the blend on the basis that they were to be used as fuels in an internal combustion engine.

Reasons for Decision

Subsection 78A(1) of the Excise Act makes provision for a rebate to be payable in respect of diesel fuel purchased for use in certain eligible activities.

Subsection 4(1) of the Excise Act defines diesel fuel 'to include any other like fuel of a kind that is prescribed'.

Paragraph (a) of subregulation 2AA(1) of the Excise Regulations 1925 prescribes the following fuels as being diesel fuel:

(i): a product on which excise duty has been paid at the rate that applies to diesel fuel at the time of the payment; and
(ii): that is capable of being used as fuel in a diesel engine.

Item 11C of the Schedule to the Excise Tariff Act 1921 sets the rate of duty for unblended diesel fuel. Excise Tariff Proposal No. 4 (2002) imposed excise duty on ethanol from midnight on 17 September 2002 at the same rate that applies to unblended diesel fuel. The Proposal also applies to subsection 6G(2) of the Excise Tariff Act (which determines the rate of duty payable on blends), with the effect that the rate of duty payable on a fuel which is a blend of diesel and ethanol is the same rate as that which applies to unblended diesel fuel. Therefore the first requirement of paragraph (a) of subregulation 2AA(1) of the Excise Regulations is satisfied.

The blend of diesel and ethanol is also clearly capable of being used as fuel in a diesel engine. Therefore the second requirement of sub-regulation 2AA(1) is also satisfied.

As the blended fuel purchased by the applicant meets the definition of 'diesel fuel' in paragraph (a) in subregulation 2AA, it is treated as diesel fuel for the purposes of subsection 78A(1) of the Excise Act and the off road scheme generally. Therefore the blended fuel will attract the diesel fuel rebate if all other eligibility conditions are met.

Date of decision: 23 June 2003

Legislative References:
Excise Act 1901
subsection 4(1)
subsection 78A(1)

Excise Tariff Act 1921
subsection 6G(2)

Excise Tariff Schedule
Item 11C

Excise Regulations 1925
subregulation 2AA(1)

Other References:
Excise Tariff Proposal No.4 (2002)

Keywords
Diesel
Diesel fuel rebate scheme
Ethanol
Excise
Excise payments
Fuel
Fuel blending

Business Line: Excise

Date of publication: 18 July 2003

ISSN: 1445-2782

history

	Date:	Version:
	23 June 2003	Original statement
You are here	8 January 2010	Archived

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