Explanatory Memorandum
(Circulated by authority of the Minister for the Environment and Heritage, Senator the Hon Robert Murray Hill)Product Stewardship (Oil) (Consequential Amendments) Bill 2000
Outline
6.1 This Chapter explains amendments to other Acts to give effect to the Scheme. These include amendments to the Product Grants and Benefits Administration Act 2000 [the 'PGBA Act'] to ensure the provisions of that Act apply appropriately to the Scheme and to ensure consistency with recent amendments to other taxation laws.
Detailed explanation of the amendments
Incorporation of relevant oils into excise blending provisions
6.2 Section 77 of the Excise Act 1901 deals with the blending of petroleum products. The effect of the amendment to section 77G is to include product classifiable to Item 15 of the Schedule to the Excise Tariff Act 1921 in the definition of "petroleum product". This amendment will bring blended oils subject to the PSO levy into line with other blended petroleum products subject to excise.
Extension to external Territories
6.3 The PGBA Act will be amended to ensure that its application to external territories in relation to product stewardship (oil) benefits is consistent with the scope of the Product Stewardship (Oil) Bill 2000 . [Schedule 1, item 2]
Application of the PGBA Act
6.4 A reference to product stewardship (oil) benefits is to be added to the table of grants and benefits to which the PGBA Act applies. [Schedule 1, item 3]
6.5 The effect of this is apply to product stewardship (oil) benefits the administrative provisions that apply generally to grants and benefits administered by the Commissioner of Taxation. Matters covered by these provisions include:
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- registration of claimants;
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- payment of benefits;
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- record-keeping requirements;
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- information gathering powers; and
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- confidentiality of information provided.
Registration of claimants
6.6 Section 9 of the PGBA Act sets out the registration requirements for claimants of grants and benefits. This section will be amended to provide for regulations to be made to specify registration requirements [Schedule 1, item 4] . It will also be amended to specify certain requirements for claimants of product stewardship (oil) benefits [Schedule 1, item 5] .
Interest on underpaid grants
6.7 The PGBA Act will be amended to provide for interest to be paid to claimants in certain circumstances. New section 24A provides for interest to be payable on amounts payable as a result of a decision made in relation to an objection against an assessment of the grant or benefit payable for a claim period.
6.8 New section 24A operates in relation to the underpayment of grants and benefits in a manner similar to that in which Part III of the Taxation (Interest on Overpayments and Early Payments) Act 1983 operates in relation to the overpayment of taxes.
6.9 This provision will require the Commissioner to pay interest in relation to a product stewardship (oil) benefit if, as a result of a decision on an objection against the assessment of the benefit, an additional amount is payable to the claimant.
When does the entitlement to interest arise
6.10 Interest is payable to a claimant if a benefit amount becomes payable as a result of a 'review decision' [Schedule 1, item 6, new subsection 24A(1)] . A review decision is defined for the purposes of this provision as a decision on an objection relating to a grant or benefit, or a decision of the AAT or a court relating to an objection [Schedule 1, item 6, new subsection 24A(4)] . A claimant may object to an assessment (or amended assessment) of a grant or benefit within 60 days of service of the notice of assessment (or amended assessment).
How is the interest calculated
6.11 Interest is calculated on a daily basis over a maximum period beginning at the time the original assessment for the relevant claim period was made and ending at the time the payment is paid, or applied against other tax-related liabilities, by the Commissioner. [Schedule 1, item 6, new subsection 24A(2)]
6.12 The interest will be calculated by applying the relevant interest rate to the underpaid amount for each day that the total grant or benefit payable to the claimant had not been paid or applied by the Commissioner. The relevant interest rate is the Treasury Note yield rate (expressed as a daily rate) for the quarter in which the day occurs. [Schedule 1, item 6, new subsection 24A(3)]
Example 1
An Oil Recycling Company Pty Ltd lodges a claim in February 2001 for a product stewardship (oil) benefit for the claim period ending 31 January 2001. The company receives a notice of assessment dated 1 March 2001 which shows the amount of benefit paid, $10 000, matches the amount claimed.
Following an ATO audit of the company's records, the company receives a notice of amended assessment which shows the benefit for the period ending 31 January 2001 as $5 000. The $5 000 owed by the company is set-off against the company's assessed benefit for a later claim period which was credited to its account on 30 June 2001.
The company disputes the adjustment to its benefit and lodges an objection with the ATO in July 2001. A decision is made on the objection which results in an additional payment of $4 000 being made on 30 September 2001.
The outcome of this sequence of events is that the product stewardship (oil) benefit for the claim period ending 31 January 2001 is underpaid by $4 000 for the period 30 June 2001 to 30 September 2001.
Interest will be payable by the Commissioner as follows:
$4000 * Treasury Note yield rate for Sept 2001 Qtr / 365 * 92.
There is no underpayment of the benefit for the period 1 March 2001 to 30 June 2001.
6.13 The provisions in the PGBA Act dealing with penalties for false or misleading statements will be repealed [Schedule 1, item 8] . These provisions will become redundant when a standardised administrative penalty scheme for false or misleading statements in relation to taxation laws comes into effect. The relevant Chapter heading in the PGBA Act will be replaced as a consequence [Schedule 1, item 7] .
6.14 The standardised administrative penalty scheme is proposed to be inserted, as Division 284, in Schedule 1 to the Taxation Administration Act 1953 by the A New Tax System (Tax Administration) Bill (No. 2) 2000. These amendments will commence after the commencement of both the Product Stewardship (Oil) Act 2000 and the A New Tax System (Tax Administration) Act (No. 2) 2000 . [subclause 2(2)]
Confidentiality of information
6.15 Section 47 of the PGBA Act provides for the confidentiality of certain information to be protected. This section will be amended to provide for the exchange of information between the Commissioner of Taxation and the Secretary of the Department responsible for administration of the Environment Protection and Biodiversity Conservation Act 1999 . [Schedule 1, items 9 to 11]