ATO Interpretative Decision

ATO ID 2004/216 (Withdrawn)

Excise

Energy Grants (Credits) Scheme: on-road - bulldozer and excavator - roadwork
FOI status: may be released

This ATO ID is withdrawn from 1 July 2012, the date the Energy Grants (Credits) Scheme Act 2003 was repealed.
Despite its withdrawal, this ATO ID continues to be a precedential ATO view in respect of the period the Act was in force, 1 July 2003 up to and including 30 June 2012.

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

Status of this decision: Decision Withdrawn 1 July 2012

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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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

Is an entity entitled to an on-road credit for operating a vehicle that is not a vehicle for transporting passengers or goods in undertaking roadwork activities under paragraph 42(2)(b) of the Energy Grants (Credits) Scheme Act 2003 (EGCSA)?

Decision

No, an entity is not entitled to an on-road credit for operating a vehicle that is not a vehicle for transporting passengers or goods in undertaking roadwork activities under paragraph 42(2)(b) of the EGCSA.

Facts

The client is contracted to undertake roadwork activities.

The client uses a diesel-powered bulldozer and excavator. These vehicles have a gross vehicle mass (GVM) of greater than 20 tonnes and are registered with the relevant transport authority for use on public roads.

The vehicles are not vehicles for transporting passengers or goods and are transported on a trailer pulled by a prime mover to the site of the roadwork activities.

Once at the site, the vehicles undertake roadwork activities such as:

•: removal of overburden
•: ripping and pushing dirt to form the road, and/or
•: excavating to lower a hill.

Reasons for Decision

Subsection 42(1) of the EGCSA provides that you are entitled to an on-road credit if you purchase diesel fuel for use in a registered vehicle with a GVM of 20 tonnes or more or incidental use in relation to such a vehicle.

However, if the vehicle is not for transporting passengers of goods, paragraph 42(2)(b) of the EGCSA limits an on-road credit to where the vehicle is operating on a road for the purpose of moving it to a 'place' where it is to operate (whether or not on road); or from a 'place' where it has operated (whether or not on a road).

The Explanatory Memorandum to the Energy Grants (Credits) Scheme Bill 2003 says:

The stationary use provisions in DAFGS were developed to counter the situation where vehicles over 20 tonnes could arrive at a location, remain on a public road and commence operations unrelated to the movement or transport operations of the vehicle (e.g. stationary construction activities such as in operating a crane) which would otherwise all qualify for the grant. In order to ensure these activities do not qualify for a credit, a requirement has been introduced that vehicles of 20 tonnes or more must be for transporting goods or passengers in order to be eligible for an on-road credit for all of their operations. If a vehicle is not for transporting goods or passengers (e.g. a special purpose vehicles such as mobile cranes), it will only be eligible for the movement to or from the place where it is to be, or has been used.

That is, the Explanatory Memorandum shows a clear intent not to allow an on-road credit for non-transport operations. In this instance, the vehicles are transported on a trailer pulled by a prime mover to and from the place where they are to undertake roadwork activities. Thus the vehicles are not, at any time, engaged in transport operations.

Accordingly, an entity is not entitled to an on-road credit for operating a vehicle that is not a vehicle for transporting passengers or goods in undertaking roadwork activities under paragraph 42(2)(b) of the EGCSA, as the fuel has not been used in moving the vehicle to or from a place where it is to operate. Rather, fuel has been used in roadwork activities.

Date of decision: 27 February 2004

Legislative References:
Energy Grants (Credits) Scheme Act 2003
subsection 42(1)
paragraph 42(2)(b)

Other References:
Explanatory Memorandum to the Energy Grants (Credits) Scheme Bill 2003
Macquarie Dictionary (Rev. 3rd Ed) Macquarie, Sydney

Keywords
Energy Grants (Credits) Scheme
EGCS on-road

Business Line: Indirect Tax

Date of publication: 5 March 2004

ISSN: 1445-2782

history

	Date:	Version:
	27 February 2004	Original statement
You are here →	1 July 2012	Archived

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