ATO Interpretative Decision

ATO ID 2006/60 (Withdrawn)

Excise

Energy Grants (Credits) Scheme: off-road - forestry - loading of felled timber onto trucks for export
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This ATO ID is withdrawn from 1 July 2012, the date the Energy Grants (Credits) Scheme Act 2003 was repealed.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.

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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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 loading of felled timber directly onto trucks, to be transported to a port for export, 'forestry' per paragraph 35(b) of the Energy Grants (Credits) Scheme Act 2003 (EGCSA)?

Decision

No. The loading of felled timber directly onto trucks, to be transported to a port for export, is not 'forestry' per paragraph 35(b) of the EGCSA.

Facts

Timber is felled in a forest or plantation as a primary produce.

After felling the felled timber is not stockpiled.

The felled timber is loaded from the coupe floor onto trucks to be transported to a port for export.

Reasons for Decision

The issue to be determined is 'when does the activity of felling timber cease'.

The word 'felling' is not defined in the EGCSA and therefore takes its ordinary meaning. In The Macquarie Dictionary, 2001, rev. 3rd edn, The Macquarie Library Pty Ltd, NSW, the verb 'fell' is defined as:

1. to cause to fall; knock, strike, or cut down: to fell a tree.

Felling of standing timber includes the preparation of felled trees to enable them to be moved, such as the removal of lateral growth and cutting into manageable lengths.

As standing timber is knocked, struck or cut down to obtain a primary produce, the activity of 'felling' ceases once the standing timber is knocked, struck or cut down and the preparation of the felled trees to enable them to be moved and the felled timber remains on the floor of the coupe.

After felling activities have ceased the felled timber is not placed in log dumps ready for transport; rather the felled timber is loaded, from the coupe floor, directly onto trucks for transport to a port for export.

If timber is felled for export, the transportation of the timber to a port is not an eligible activity: see paragraphs 135 to 144 of the Product Grant and Benefit Ruling PGBR 2005/1. The loading of timber on trucks is integral to the transportation activity and is therefore also ineligible.

In this case, forestry as a primary production activity ceases after the timber is felled and prior to loading it onto trucks for transportation to the port.

Therefore the loading of felled timber directly onto trucks for transport to a port for export is not a core forestry activity per paragraph 35(b) of the EGCS.

Date of decision: 25 November 2005

Legislative References:
Energy Grants (Credits) Scheme Act 2003
paragraph 35(b)

Related Public Rulings (including Determinations)
Product Grants and Benefits Ruling PGBR 2005/1

Related ATO Interpretative Decisions
ATO ID 2004/466

Keywords
EGCS forestry
EGCS thinning or felling

Business Line: Indirect Tax

Date of publication: 24 February 2006

ISSN: 1445-2782

history

	Date:	Version:
	25 November 2005	Original statement
You are here	1 July 2012	Archived

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