ATO Interpretative Decision
ATO ID 2007/115 (Withdrawn)
Excise
Excise: treatment of ship's stores on vessels that change from an international to domestic voyageFOI status: may be released
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This ATO ID is withdrawn because the ATO is reconsidering the position stated in the ATO ID.This document incorporates revisions made since original publication. View its history and amending notices, if applicable.
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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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
Are ship's stores exported for the purposes of the Excise Act 1901 (Excise Act) when they are taken on board a ship in Australia intended for an international voyage?
Decision
Yes. Ship's stores are exported for the purposes of the Excise Act when they are taken on board a ship in Australia intended for an international voyage.
Facts
Fuel is taken on board a ship in Australia to power the ship on an international voyage.
Reasons for Decision
Subsection 160A of the Excise Act provides that, except as provided by the regulations, ship's stores are not liable to excise duty. Currently the regulations provide that certain alcoholic beverages and tobacco products cease to be free of duty unless provided to passengers or crew in specified quantities.
The term 'ship's stores' is defined in subsection 160A(5) of the Excise Act as stores for the use of the passengers or crew of an overseas ship, or for the service of an overseas ship.
Section 4 of the Excise Act defines an overseas ship by reference to the ship's stores provisions of the Customs Act 1901 (Customs Act). An overseas ship does not include a ship that is not currently engaged in or is not about to engage in making an international voyage.
Section 61 of the Excise Act provides that excisable goods are subject to the CEO's control until they are delivered for home consumption or delivered for exportation to a place outside Australia. Section 61AA of the Excise Act provides that 'delivered for exportation' requires the goods to be delivered to a place that is a prescribed place for export under paragraph 30(1)(d) of the Customs Act.
The question then is whether ship's stores are exported when they are taken on board a ship in Australia that is intended for an international voyage.
The term 'export' is not defined in either the Customs or Excise legislation. However, the courts have given extensive consideration to the meaning of the term.
In Australian Trade Commission v. Goodman Fielder Industries Ltd (1992) 36 FCR 517 Beaumont, Gummow and Einfeld JJ of the Federal Court stated at page 523:
The ordinary meaning of 'export' is to send commodities from one country to another using the verb 'send' as indicating that which occasioned or brought about the carriage of the commodity from one country to another.
The Supreme Court of the Northern Territory considered the term 'export' in the context of the Customs Act. In Wesley-Smith and Ors v. Balzary (1976-77) 14 ALR 681 Forster J said at page 688:
Export in the first sense no doubt means taking goods out of a proclaimed port or across a low water mark with the intention of landing them at some place beyond the seas.
On the basis that ship's stores are for the use of the passengers or crew of an overseas ship, or for the service of an overseas ship, and will therefore not be landed 'at some place beyond the seas', they do not fall within the ordinary meaning of the term 'export' set out above.
However, given the linkages between the Excise Act and the Customs Act in relation to ship's stores, it is reasonable to seek guidance from the latter Act in determining whether ship's stores are 'exported'.
Subsection 113(1) of the Customs Act effectively provides that an owner of goods intended for export must
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- ensure that the goods are entered for export; and
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- not allow the goods to be loaded on the ship or aircraft in which they are to be exported (unless an authority to deal with them is in force, or the goods are exempted from this requirement (either absolutely or on such terms and conditions) as specified in the Customs Regulations 1926).
Subsection 113(2) of the Customs Act provides that subsection 113(1) of the Customs Act will not apply in certain circumstances. One circumstance, set out in paragraph 113(2)(f) of the Customs Act is where goods are specified in the regulations as being exempted from the section.
Subregulations 97(3) and (4) of the Customs Regulations specify the goods that are prescribed for the purposes of paragraph 113(2)(f) of the Customs Act. In certain circumstances and subject to various conditions, ship's stores and aircraft's stores are prescribed for the purposes of paragraph 113(2)(f) of the Customs Act.
It is the Commissioner's view that if ship's stores were not considered to be exported, it would not have been necessary for them to be explicitly legislatively exempted from the export entry requirement.
Therefore, it is the Commissioner's view that the ordinary meaning of the term 'export' is extended for the purposes of the ship's stores provisions of the Excise Act, and that ship's stores are exported when taken on board a ship in Australia that is intended for an international voyage.
Date of decision: 23 May 2007
Legislative References:
Excise Act 1901
section 61
section 61AA
section 160A
subsection 160A(5)
paragraph 30(1)(d)
section 113
subsection 113(2) Customs Regulations 1926
regulation 97
Case References:
Australian Trade Commission v. Goodman Fielder Industries Ltd
(1992) 36 FCR 517
(1976-77) 14 ALR 681
Keywords
Excise
Ship's stores
Export of goods
ISSN: 1445-2782
| Date: | Version: | |
| 23 May 2007 | Original statement | |
| You are here | 13 July 2007 | Archived |