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Edited version of your private ruling
Authorisation Number: 1012556422136
Ruling
Subject: Fuel tax credits - Light vehicles off-road
Question 1
Is a specific road considered a public road for the purposes of fuel tax credits?
Answer
Yes.
Question 2
Are you entitled to a fuel tax credit for unleaded petrol and liquefied petroleum gas (LPG) you acquire for use in a vehicle under 4.5 tonnes gross vehicle mass (GVM) travelling on that road?
Answer
No.
This ruling applies for the following periods:
2013 - 2014 income year
The scheme commences on:
1 July 2013
Relevant facts and circumstances
1. Your business activities involve preparing for and conducting vehicular events in state forests, on crown land and national parks.
2. You state that the public does not have a plenary right of access at all times to travel on the roads where you will be conducting your enterprise, as some areas are restricted to the public.
3. You hold an annual tour operator licence issued by a State government department (the Department) which allows you to conduct organised tours or recreational business for profit on Public land in the State. Public land includes land and waters managed by and on behalf of the Crown under various laws. This licence also allows you to operate over more than one area of Crown land.
4. You state that where members of the public may have access to use the roads where you will be conducting your enterprise, the relevant authorities can deny, without notice, access to the road by members of the public. This is why you obtain permits on every event you run.
5. You state that where you conduct your vehicular events, all tracks are maintained by the Department who are not an authority responsible for the provision of road transport infrastructure. The Department are only obliged to maintain the tracks for the safety, fire access and access for the public.
6. You advise that one of the tracks you use in conducting your events does have a name (the specific road).
7. The local office of the Department advise that this specific road is depicted on maps and that it is not closed to the public during your events.
8. The Department advise that while this road is not listed in the register of public roads, it has been set aside for use by the public and only closed if there is a danger to the public such as during high fire danger periods or impassability of the road during wet weather.
9. The Department also advise that this road is unsuitable for and not used for forestry, its purpose is to give the public access to Crown land.
10. You state that your vehicle has a GVM of less than 4.5 tonnes and that you acquire unleaded petrol and LPG for use in the vehicle.
11. You state that you will be registering for GST.
Relevant legislative provisions
Fuel Tax Act 2006 section 41-5
Fuel Tax Act 2006 subdivision 41-B
Fuel Tax Act 2006 section 41-20
Fuel Tax Act 2006 section 43-10
Reasons for decision
Section 41-5 of the Fuel Tax Act 2006 (FTA) provides that you are entitled to a fuel tax credit for taxable fuel that you acquire in Australia to the extent that you do so for use in carrying on your enterprise, if you are registered for GST. However, this entitlement is affected by the disentitlement provisions of subdivision 41-B of the FTA.
Section 41-20 provides that you are not entitled to a fuel tax credit for taxable fuel to the extent that you acquire, manufacture or import the fuel for use in a vehicle with a GVM of 4.5 tonnes or less travelling on a public road.
Road user charge (RUC)
Should you be eligible for a fuel tax credit under 41-5 of the FTA, section 43-10 provides that your fuel tax credit entitlement can also be affected by:
· the amount of any applicable grant or subsidy; or
· the amount of the road user charge (RUC) in relation to use of taxable fuel in heavy vehicles for travelling on public roads.
What are public roads?
In Fuel Tax Ruling FTR 2012/1 - Fuel tax: fuel tax credits for taxable fuel acquired or manufactured in, or imported into Australia to use in carrying on an enterprise involving 'agriculture' as defined in section 43-15 of the Fuel Tax Act 2006 (FTR 2012/1) at paragraphs 446 to 468 the Commissioner sets out the meaning of public roads. The principles outlined in this ruling apply to public roads within the FTA.
At paragraph 446 of FTR 2012/1 the Commissioner states:
A 'road' is defined in common law as a way from one place to another which enables passage between the two. It is well established that, under the common law, a 'road' becomes a 'public road' when the owner of the land has unequivocally indicated an intention to dedicate the road for public use, and the public has accepted the proffered dedication.
At paragraph 460 of FTR 2012/1, the Commissioner goes on to list the following elements which need to be considered in determining whether a road has been dedicated as a road under common law:
· Has there been a declaration of an intention to dedicate a road for use by the public?
· Has the road been delineated on maps or plans of roads set apart for public use?
· Is the road used by the public?
· Must vehicles be registered to use the road and state or territory traffic laws are applicable while the vehicles use the road?
· Do public bodies spend money in forming or maintaining the land as a road?
On balance these matters may indicate that a road has been dedicated to the public as a road. Where that dedication is accepted by the public, the road is a public road.
This can be contrasted with private roads which run over or through private land and which can be closed to the public without notice by the land owner.
One of the areas you use is the specific road. This road is considered to be a public road because:
§ the public has access to it at all times,
§ it is maintained by the State government Department to ensure that the public can access Crown land and its use is not subordinate to some other use such as forestry;
§ it is depicted on maps;
§ vehicles which use that road need to be registered for road use;
§ the Department is a public body which has responsibility for maintaining the land as a road; and
§ unlike a private road, this specific road is not subject to closure by the Department but rather only when there is a danger to the public if they use the road.
As this road is a public road for fuel tax credit purposes and you will be using taxable fuel in a vehicle of less than 4.5 tonnes GVM for travelling on a public road, you would not be entitled to a fuel tax credit for this fuel in accordance with section 41-20 of the FTA.
As your use of fuel in your vehicular activities would not be eligible for fuel tax credits in accordance with section 41-20 of the FTA, the application of the RUC under section 43-10 is redundant.
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