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Edited version of your written advice
Authorisation Number: 1051192078633
Date of Advice: 24 February 2017
Ruling
Subject: Fuel tax Credits
Question
Is a purpose-built bus-only road (a transitway) a public road for the purposes of subsection 43-10(3) of the Fuel Tax Act 2006 (FTA)?
Answer
Yes.
This ruling applies for the following periods:
2016 - 2017 income year
2017 - 2018 income year
2018 - 2019 income year
The scheme commences on:
1 July 2016
Relevant facts and circumstances
The entity is a private bus operator providing passenger transport services including contracts with the government.
The entity provides a passenger bus service to the general public. Some of the bus routes involves travel on a Transitway (T-way).
The entity is registered for goods and services tax. The entity acquires taxable fuel for use in its buses for travelling on the T-way.
The relevant road management legislation provides that a transitway is not a road or road-related area for the purposes of the relevant Acts and regulations that deal with the road rules of the State.
The State Road Rules provides that a driver must not drive in a transit lane unless the driver is driving a public bus, public minibus, motor bike, taxi or tram; or unless specified circumstances are met.
Further the State Road Rules stipulate that only drivers of an authorised 'T-way vehicle' are permitted to drive or stop in a T-way lane. An 'authorised T-way vehicle', is a vehicle or class of vehicle, approved by the relevant Authority and must display an authorised T-way label or plate.
Relevant legislative provisions
Fuel Tax Act 2006 subsection 43-10(3)
Reasons for decision
By application of subsection 43-10(3) of the FTA the fuel tax credit for taxable fuel relevantly, acquired for use, in a vehicle, for travelling on a public road, is reduced by the amount of the road user charge for the fuel.
The Commissioner has published Fuel Tax Ruling FTR 2008/1: Fuel tax: vehicle's travel on a public road that is incidental to the vehicle's main use and the road user charge. At paragraph 43D of FTR 2008/1 the Commissioner states:
43D. The term 'public road' is not defined in the FT Act and therefore it takes its ordinary meaning.
Examples of public roads, included at paragraph 44, are:
44. For the purposes of subsections 43-10(3) and 43-10(4), examples of a 'public road' include, a road:
Opened, declared or dedicated as a public road under a statute;
Vested in a government authority having statutory responsibility for the control and management of public road infrastructure; or
Dedicated as a public road at common law.
The ordinary meaning of 'public road'
The word 'public', as it appears in the phrase 'public road' throughout the FTA, is used to modify the noun 'road'. Therefore the meaning ascribed to the phrase 'public road' must be within the context of the adjective 'public' as it describes the noun 'road'.
The Macquarie Dictionary, [Online], viewed 21 February 2017, relevantly defines the adjective 'public' as:
Public
Adjective 3. open to all the people: a public meeting.
The Macquarie Dictionary, [Online], viewed 21 February 2017, relevantly defines the noun 'road' as:
Road
Noun 1. a way, usually open to the public for the passage of vehicles, persons and animals.
Therefore, in the context of the FTA, a 'public road' is:
A way open to members of the public for the passage of vehicles, persons and animals
It is noted that within the relevant Roads Act it states that a transitway is not a road within the meaning of the Road Transport Act. It is also noted that the Road Rules provide limitations to the vehicles that may use a T-way, including that the vehicle must be an 'authorised vehicle.
The entity's buses travel on the T-way and are therefore authorised to travel for the purposes of the Road Rules. The entity's buses transport members of the public on the T-way.
The FTA does not define a 'public road' nor does it rely a definition of the term within other statutes. As such the various statutes that give a meaning of a 'road' or a 'transitway' have no bearing on the meaning of a 'public road' for the purposes of the FTA.
A T-way is a transport corridor used by authorised vehicles. One such vehicle is a bus transporting the public. As such a T-way is a 'way open to members of the public' and a public road for the purposes of subsection 43-10(3) of the FTA.