Commodity and other indirect taxes

Date

27 January 2015

F. Commodity and other indirect taxes

F1 Primary industry levies — exemptions for small and large producers

Agriculture, forestry and fishing ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
*	*	*	*	*	*	*	*
Tax expenditure type:		Exemption				2014 TES code:	F1
Estimate Reliability:		Not Applicable				* Category	1+
Commencement date:		Introduced before 1985				Expiry date:
Legislative reference:		Primary Industries (Customs) Charges Act 1999 Primary Industries (Excise) Levies Act 1999

Certain producers are exempt from primary industry levies. While the specific exemptions differ on a commodity by commodity basis, they are all in some way related to the quantity or value of the particular commodity produced in a given year.

F2 Exemptions from radiocommunications taxes for not-for-profit community or government entities

General public services — General services ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
6	8	3	5	5	5	5	5
Tax expenditure type:		Exemption				2014 TES code:	F2
Estimate Reliability:		Medium
Commencement date:		1992				Expiry date:
Legislative reference:		Section 294, Part 5.7 of the Radiocommunications Act 1992 Appendix E of the ACMA Apparatus licence fee schedule April 2015

An exemption from the apparatus licence fee is available to organisations or individuals who are: diplomatic and consular missions; surf lifesaving and remote area ambulance services; emergency services or services for the safe-guarding of human life — such as rural fire fighting and coast guard services. These must be staffed principally by volunteers and be exempt from paying income tax.

F3 Passenger Movement Charge exemptions

Transport and communication ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
50	60	70	70	70	80	80	90
Tax expenditure type:		Exemption				2014 TES code:	F4
Estimate Reliability:		Medium — High
Commencement date:		1978				Expiry date:
Legislative reference:		Passenger Movement Charge Act 1978

Certain passengers are exempt from the Passenger Movement Charge, including foreign diplomats, children and outbound crew.

F4 Regional Equalisation Plan rebates

Transport and communication ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
2	1	1	1	1	1	..	..
Tax expenditure type:		Rebate				2014 TES code:	F5
Estimate Reliability:		Medium
Commencement date:		1 July 2000				Expiry date:	31 Dec 2017
Legislative reference:		Television Licence Fees Act 1964 Television Licence Fees Regulations 1990

Remote commercial television broadcasters are entitled to a licence fee rebate to assist with the costs associated with the switchover to digital television until 31 December 2017. Regional broadcasters were entitled to the rebate until 31 December 2012.

F5 Luxury car tax

Other economic affairs — Other economic affairs, nec ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
-440	-432	-476	-540	-520	-510	-520	-530
Tax expenditure type:		Increased rate				2014 TES code:	F6
Estimate Reliability:		Medium
Commencement date:		1 July 2000				Expiry date:
Legislative reference:		A New Tax System (Luxury Car Tax) Act 2000

The luxury car tax currently applies to cars that have a GST inclusive price over $61,884 (the luxury car tax threshold for the 2014-15 financial year). The luxury car tax is 33 per cent of the GST exclusive value of the car that exceeds the luxury car tax threshold. As motor vehicle purchases are not taxed under the benchmark, the luxury car tax is a negative tax expenditure.

‘Primary producers’ or certain tourism businesses that acquire a ‘refund-eligible car’ after 30 June 2008 are eligible to claim a tax refund of up to $3,000 of the amount of luxury car tax paid.

From 3 October 2008 a higher luxury car tax threshold has applied to fuel efficient cars. Eligible fuel efficient cars are subject to a threshold of $75,375 for luxury car tax purposes (for the 2014-15 financial year).

Public museums and public art galleries that have been endorsed by the Commissioner of Taxation as a Deductible Gift Recipient will be allowed to acquire cars free of luxury car tax when the car is acquired for the purpose of public display. This will have effect from the date of Royal Assent of the enabling legislation.

F6 Tourism — inwards duty free

Other economic affairs — Other economic affairs, nec ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
*	*	*	*	*	*	*	*
Tax expenditure type:		Exemption				2014 TES code:	F7
Estimate Reliability:		Not Applicable				* Category	3+
Commencement date:		Introduced before 1985 1 July 2000 (WET)				Expiry date:
Legislative reference:		Customs Act 1901 Item 15 in Part 1 of Schedule 4 to the Customs Tariff Act 1995 Section 7-15 of a A New Tax System (Wine Equalisation Tax) Act 1999

Tobacco and alcohol products brought into Australia by inbound international travellers 18 years and over, within an allowance, are not subject to wine equalisation tax and excise-equivalent customs duty.

F7 Concessional rate of excise levied on aviation gasoline and aviation turbine fuel

Fuel and energy ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
1,070	970	950	1,110	1,190	1,240	1,310	1,390
Tax expenditure type:		Concessional rate				2014 TES code:	F8
Estimate Reliability:		Medium
Commencement date:		15 March 1956				Expiry date:
Legislative reference:		Item 10 of the Schedule to the Excise Tariff Act 1921

Aviation gasoline and aviation turbine fuel are subject to a lower rate of excise than the benchmark rate. From 1 July 2012 to 30 June 2014, the excise rate included a ‘carbon component rate’, which was determined by the emission factor of each fuel and the carbon price. The inclusion of a carbon component of excise reduced the value of the concessional rate of excise. From 1 July 2014, the value of the concession increased due to the removal of the carbon component.

F8 Excise concessions for ‘alternative fuels’

Fuel and energy ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
690	550	340	360	390	410	390	400
Tax expenditure type:		Concessional rate, Increased rate				2014 TES code:	F9
Estimate Reliability:		Low
Commencement date:		1985				Expiry date:
Legislative reference:		Excise Tariff Act 1921

‘Alternative’ fuels includes ethanol, biodiesel, liquefied petroleum gas (LPG), liquefied natural gas (LNG) and compressed natural gas (CNG). These fuels are subject to rates of duty which are lower than the benchmark rates. The benchmark rates vary depending on the fuels’ energy content relative to petrol and diesel. The difference between the actual rate of duty and the benchmark rate for each fuel gives rise to the tax expenditure.

From 1 July 2015, domestically produced ethanol and biodiesel had their rates of duty reduced to zero. Each 1 July thereafter, domestically produced ethanol will have its rate of duty increased (in addition to indexation) until the 2020-21 financial year, when the excise rate for ethanol will be approximately 33 per cent of the excise rate for petrol. This will be 50 per cent of ethanol’s benchmark rate.

Domestically produced biodiesel will have its rate of duty increased (in addition to indexation) until the 2030-31 financial year, when the excise rate for biodiesel will be approximately 50 per cent of the excise rate for diesel.

Since 1 July 2015, the rates of duty on LPG, LNG and CNG have been 50 per cent of each fuel’s respective benchmark rate.

Users of small, non-commercial scale, domestically-based compressed natural gas refuellers are exempt from paying excise duty on compressed natural gas used to fuel their vehicles.

F9 Excise levied on fuel oil, heating oil and kerosene

Fuel and energy ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
-470	-490	-440	-250	-260	-290	-310	-340
Tax expenditure type:		Increased rate				2014 TES code:	F10
Estimate Reliability:		Medium — Low
Commencement date:		1983				Expiry date:
Legislative reference:		Item 10 of the Schedule to the Excise Tariff Act 1921

The benchmark excise rate for fuels consumed for a purpose other than in an internal combustion engine is zero. Fuel oil, heating oil, and kerosene are subject to excise equivalent to that applying to petroleum and diesel. Users are eligible for a fuel tax credit of an equivalent value.

F10 Excise levied on fuel products used for purposes other than as fuel

Fuel and energy ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
-55	-55	-55	-65	-65	-65	-65	-65
Tax expenditure type:		Increased rate				2014 TES code:	F11
Estimate Reliability:		Medium — Low
Commencement date:		1 July 2006				Expiry date:
Legislative reference:		Item 10 of the Schedule to the Excise Tariff Act 1921

Fuels consumed for a purpose other than in an internal combustion engine (such as toluene used as a solvent) are subject to excise equivalent to that applying to petroleum and diesel. Business users of these products are eligible for a fuel tax credit of an equivalent value.

F11 Higher rate of excise levied on cigarettes not exceeding 0.8 grams of tobacco

Health ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
nfp	nfp	-1,790	-1,935	-1,995	-2,140	-2,235	-2,290
Tax expenditure type:		Increased rate				2014 TES code:	F12
Estimate Reliability:		Medium — Low
Commencement date:		1999				Expiry date:
Legislative reference:		Item 5 of the Schedule to the Excise Tariff Act 1921

Note: estimates for 2012-13 and prior years are not reported consistent with statutory requirements relating to taxpayer confidentiality.

The benchmark excise rate is the rate per kilogram applying to tobacco products containing more than 0.8 grams of tobacco. Cigarettes and cigars containing no more than 0.8 grams of tobacco pay excise at a per-stick rate. This results in a higher excise liability than if they were subject to the benchmark rate.

F12 Concessional rate of excise levied on brandy

Other economic affairs — Other economic affairs, nec ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
4	4	4	5	5	5	5	5
Tax expenditure type:		Concessional rate				2014 TES code:	F13
Estimate Reliability:		Medium
Commencement date:		9 November 1979				Expiry date:
Legislative reference:		Item 3 of the Schedule to the Excise Tariff Act 1921

Brandy is subject to a lower rate of excise than other spirits ($75.10 per litre of alcohol as at 1 August 2015).

F13 Concessional rate of excise levied on brew-on-premise beer

Other economic affairs — Other economic affairs, nec ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
4	4	4	4	4	4	4	4
Tax expenditure type:		Concessional rate				2014 TES code:	F14
Estimate Reliability:		Medium
Commencement date:		1993				Expiry date:
Legislative reference:		Item 1 of the Schedule to the Excise Tariff Act 1921

Brew-on-premise beer (that is, beer produced for non-commercial purposes using commercial facilities or equipment) is subject to a lower rate of excise than the benchmark rate of full strength beer packaged in individual containers not exceeding 48 litres.

F14 Concessional rate of excise levied on draught beer

Other economic affairs — Other economic affairs, nec ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
155	155	160	160	155	160	165	170
Tax expenditure type:		Concessional rate				2014 TES code:	F15
Estimate Reliability:		Medium
Commencement date:		2001				Expiry date:
Legislative reference:		Item 1 of the Schedule to the Excise Tariff Act 1921

Draught beer (that is, beer packaged in individual containers exceeding 48 litres) is subject to a lower rate of excise than the benchmark rate of full strength beer packaged in individual containers not exceeding 48 litres.

F15 Concessional rate of excise levied on low strength packaged beer

Other economic affairs — Other economic affairs, nec ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
8	8	7	6	6	6	6	6
Tax expenditure type:		Concessional rate				2014 TES code:	F16
Estimate Reliability:		Medium
Commencement date:		21 August 1984				Expiry date:
Legislative reference:		Item 1 of the Schedule to the Excise Tariff Act 1921

Low strength beer with an alcohol content of no more than 3 per cent packaged in containers not exceeding 48 litres is subject to a lower rate of excise than the benchmark rate of similarly packaged full strength beer.

F16 Excise concession for breweries

Other economic affairs — Other economic affairs, nec ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
..	4	4	5	5	5	5	6
Tax expenditure type:		Concessional rate				2014 TES code:	F19
Estimate Reliability:		Medium
Commencement date:		2000				Expiry date:
Legislative reference:		Division 4 and Schedule 1 to the Excise Regulations 2015

Breweries receive an excise refund of 60 per cent of excise paid on or after 1 July 2012, up to a maximum amount of $30,000 per financial year.

F17 Excise exemption for privately produced beer

Other economic affairs — Other economic affairs, nec ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
40	40	45	40	40	40	45	45
Tax expenditure type:		Exemption				2014 TES code:	F17
Estimate Reliability:		Medium
Commencement date:		18 April 1973				Expiry date:
Legislative reference:		Schedule to the Excise Tariff Act 1921

Beer made for personal use by private individuals is exempt from the payment of excise.

F18 Increased rate of excise levied on excisable alcoholic beverages (other than beer) not exceeding 10 per cent alcohol

Other economic affairs — Other economic affairs, nec ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
-520	-515	-510	-495	-490	-500	-515	-535
Tax expenditure type:		Increased rate				2014 TES code:	F20
Estimate Reliability:		Medium
Commencement date:		2000				Expiry date:
Legislative reference:		Item 2 of the Schedule to the Excise Tariff Act 1921

Excisable alcoholic beverages (other than beer) with an alcohol content not exceeding 10 per cent are subject to a higher rate of excise than the benchmark rate of full strength beer packaged in individual containers not exceeding 48 litres.

From 27 April 2008 the excise rate on these other excisable beverages increased to the same excise rate as applies to most spirits ($80.41 per litre of alcohol as at 1 August 2015).

F19 Wine equalisation tax exemption for privately produced wine

Other economic affairs — Other economic affairs, nec ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
10	10	11	11	12	12	13	14
Tax expenditure type:		Exemption				2014 TES code:	F18
Estimate Reliability:		Medium
Commencement date:		19 August 1970				Expiry date:
Legislative reference:		A New Tax System (Wine Equalisation Tax) Act 1999

Wine made for personal use by private individuals is exempt from the wine equalisation tax.

F20 Wine equalisation tax producer rebate

Other economic affairs — Other economic affairs, nec ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
280	290	300	320	330	350	370	390
Tax expenditure type:		Rebate				2014 TES code:	F21
Estimate Reliability:		Medium
Commencement date:		1 October 2004				Expiry date:
Legislative reference:		A New Tax System (Wine Equalisation Tax) Act 1999

Wine producers are able to claim a rebate of up to $500,000 of wine equalisation tax payable on eligible wine sales per financial year. The producer rebate was introduced on 1 October 2004 and the current maximum rebate was introduced on 1 July 2006. The rebate also extends to traditionally-brewed cider, mead, perry and sake.

F21 Certain exemptions for diplomatic missions and foreign diplomats

General public services — Foreign affairs and economic aid ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
1	1	1	1	1	1	1	1
Tax expenditure type:		Concessional rate				2014 TES code:	F22
Estimate Reliability:		Medium — High
Commencement date:		21 August 1940				Expiry date:
Legislative reference:		Division 2 and Schedule 1 of the Excise Regulation 2015 Section 10 of the Diplomatic Privileges and Immunities Act 1967 Section 10 of the Consular Privileges and Immunities Act 1972 Section 11 of the International Organisations (Privileges and Immunities) Act 1963 Section 12 of the Overseas Missions (Privileges and Immunities) Act 1995

Note: estimates represent excise duty only.

Excise, luxury car tax and wine equalisation tax are not payable (or an equivalent amount of that paid is claimable) for alcohol, fuel, motor vehicles and tobacco used for official purposes by diplomatic missions or for personal use by persons identified in the Diplomatic Privileges and Immunities Act 1967.

F22 Certain exemptions for Australian military sea vessels

Defenc
e ($m)
2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19
*	*	*	*	*	*	*	*
Tax expenditure type:		Concessional rate				2014 TES code:	F23
Estimate Reliability:		Not Applicable				* Category	1+
Commencement date:		2 August 1934				Expiry date:
Legislative reference:		Schedule 1 to the Excise Regulation 2015