ATO Interpretative Decision

ATO ID 2007/62

Excise

PSO and a change to an item in the table in subregulation 4(1) within a claim period
FOI status: may be released

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Issue

Is a benefit under Item 3 in the table in subregulation 4(1) of the Product Stewardship (Oil) Regulations 2000 (Item 3) payable in respect of diesel fuel sold before 16 December 2006 if the diesel fuel does not comply with the Fuel Standards (Automotive Diesel) Determination 2001 when a claim for the benefit is made after 16 December 2006?

Decision

Yes, a benefit is payable under Item 3 for diesel fuel sold before 16 December 2006 if the diesel fuel does not comply with the Fuel Standards (Automotive Diesel) Determination 2001 even when the claim is made after 16 December 2006.

Facts

An entity is registered for entitlement to product stewardship (oil) benefits (PSO benefits) under section 9 of the Product Grants and Benefits Administration Act 2000 (PGBAA).

The entity has manufactured diesel fuel by recycling waste oil. The Excise Tariff Act 1921 applies to the diesel fuel that was manufactured. The diesel fuel does not comply with the Fuel Standard (Automotive Diesel) Determination 2001.

The entity sold diesel fuel both before and after 16 December 2006.

The entity has lodged a claim for PSO benefits. The claim relates to recycled oil sold both before and after 16 December 2006.

Reasons for Decision

The Product Stewardship (Oil) Act 2000 (PSO Act) sets out the requirements for entitlement to PSO benefits.

Subsection 9(1) of the PSO Act provides that an entity is entitled to a PSO benefit for the sale or consumption of recycled oil that the entity recycled in Australia.

Subsection 10(1) of the PSO Act provides that if an entity is entitled to a benefit in respect of the sale or consumption of recycled oil during a claim period, the amount of the PSO benefit is worked out in accordance with the regulations.

Subparagraph 4(1)(a)(i) of the Product Stewardship (Oil) Regulations 2000 (PSO Regulations) states that the amount of benefit payable for a claim period for a recycled oil is:

(i)
the amount mentioned in column 3 of the first category in items 1 to 7 in the following table that applies to the recycled oil;

Subsection 10(1) of the PSO Act indicates that an entitlement to a PSO benefit arises for each sale or consumption of recycled oil. Therefore, the amount of benefit calculated under subparagraph 4(1)(a)(i) of the PSO Regulations must be determined separately for each quantity of recycled oil sold or consumed.

In this case the description of recycled oil in Item 3 was amended, with effect from 16 December 2006, by the Product Stewardship (Oil) Amendment Regulations 2006 (No. 2).

Prior to the amendment the recycled oil in Item 3 was described as:

Diesel fuels to which the Excise Tariff Act 1921 applies.

After the amendment it was described as:

Diesel fuels that comply with the Fuel Standard (Automotive Diesel) Determination 2001, as in force from time to time.

Therefore, to attract a PSO benefit under Item 3, recycled oil sold prior to 16 December 2006 need only be a diesel fuel to which the Excise Tariff Act applies, whereas recycled oil sold on or after 16 December 2006 must be diesel fuel that complies with the Fuel Standard (Automotive Diesel) Determination 2001 in force at the time the fuel is sold.

As the entity's recycled oil did not comply with the Fuel Standard (Automotive Diesel) Determination 2001, sales that occurred on or after 16 December 2006 are not eligible for a PSO benefit under Item 3. However, because Item 3 did not contain the requirement to comply with the Fuel Standard prior to 16 December 2006, and the entity's recycled oil met the description of a recycled oil in Item 3 at that time, the entity remains eligible to claim a PSO benefit under Item 3 for sales that occurred prior to 16 December 2006. This is the case regardless of whether the entity had claimed for the pre 16 December 2006 sales before or after 16 December 2006.

Note: a PSO benefit may be payable on the recycled oil sold or consumed after 16 December 2006 under another item in the table in subregulation 4(1) of the PSO Regulations where, at the time of sale or consumption, the recycled oil met the description of another item in that table.

Date of decision:  26 March 2007

Legislative References:
Product Stewardship (Oil) Act 2000
   subsection 9(1)
   subsection 10(1)

Product Stewardship (Oil) Regulations 2000
   subsection 4(1)
   subparagraph 4(1)(a)(i)

Keywords
Product stewardship oil scheme
Recycled waste oil

Business Line:  Indirect Tax

Date of publication:  30 March 2007

ISSN: 1445-2782

history
  Date: Version:
You are here 26 March 2007 Original statement
  17 January 2019 Archived

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