Explanatory Memorandum
(Circulated by authority of the Treasurer, the Hon Peter Costello, MP)General outline and financial impact
Energy Grants (Credits) Scheme
The Energy Grants (Credits) Scheme Bill 2003 replaces the DFRS and the DAFGS entitlement provisions with a single entitlement called the EG(C)S to commence on 1 July 2003.
The EG(C)S will maintain entitlements equivalent to those currently available under the DFRS administered under the Customs Act 1901 and the Excise Act 1901, and the DAFGS administered under the Diesel and Alternative Fuels Grants Scheme Act 1999.
The PGBAA will provide the administrative and compliance framework for the EG(C)S.
New provisions in the PGBAA allow the Commissioner to provide public and private rulings in respect of grants and benefits.
Under the PGBAA, claimants will be responsible for correctly self-assessing their entitlements and maintaining records to substantiate their entitlements.
This bill establishes the EG(C)S by:
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- replicating the existing entitlement provisions in the Diesel and Alternative Fuels Grants Scheme Act 1999, the Customs Act 1901 and the Excise Act 1901 to create an on-road credit and an off-road credit;
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- making minor amendments to the eligibility criteria for the existing schemes to clarify the Government's position on certain activities;
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- addressing current administrative inconsistencies between the 2 schemes. These include:
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- adopting a prospective entitlement point;
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- having a common provision for calculating entitlements;
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- applying entitlements to a credit to fuel that is purchased or imported into Australia; and
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- removing differences in determining the rebate/grant rate applicable to a claim; and
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- the inclusion under the EG(C)S of certain activities currently eligible for a remission, refund or rebate under the Customs Regulations 1926 and the Excise Regulations 1925.
Consequential Amendments
The Energy Grants (Credits) Scheme (Consequential Amendments) Bill 2003 amends or repeals certain Acts as a consequence of the implementation of the EG(C)S.
Consequential amendments are made to:
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- the PGBAA;
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- the Diesel and Alternative Fuels Grants Scheme Act 1999;
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- the Customs Act 1901;
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- the Excise Act 1901;
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- the TAA 1953;
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- A New Tax System (Australian Business Number) Act 1999; and
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- the ITAA 1936.
This bill:
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- brings the EG(C)S under the administration of the PGBAA to align it with the compliance and administrative framework of the other grant programs administered by the ATO;
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- updates the PGBAA provisions to address certain administrative issues that have been identified as a result of the ATO's experience in administering the schemes;
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- repeals the DFRS provisions contained in the Customs Act 1901, the Excise Act 1901 and the DAFGS provisions in the Diesel and Alternative Fuels Grants Scheme Act 1999;
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- provides transitional arrangements to allow for ongoing compliance activity for claims made under the DFRS and DAFGS. It also provides for the claiming of entitlements for fuel purchased before 1 July 2003;
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- amends the TAA 1953 to reflect the repeal of the Diesel and Alternative Fuels Grants Scheme Act 1999 and the new arrangements for administration of the EG(C)S under the PGBAA. Amendments are also made to Part IVAAA and Part IVAA of the TAA 1953 to bring the PGBAA within the scope of the public and private rulings regime in the TAA 1953; and
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- makes minor, ancillary amendments to the A New Tax System (Australian Business Number) Act 1999 and the ITAA 1936.
Date of effect: The EG(C)S will commence on 1 July 2003.
Proposal announced: These bills give effect to an announcement made by the Prime Minister on 28 May 1999 under Measures for a Better Environment to introduce an EG(C)S to replace the DFRS and DAFGS.
Financial impact: Amendments to the point of entitlement for the on-road credit and to the eligibility criteria to clarify the Government's position on certain activities under the EG(C)S will cost $19 million in the 2003-2004 financial year, $4 million in the 2004-2005 financial year, $5 million in the 2005-2006 financial year and $5 million in the 2006-2007 financial year.
Compliance cost impact: The amendments will reduce administrative complexity and compliance costs for claimants by replacing the dual compliance and administrative arrangements that exist under the DFRS and DAFGS with the single compliance and administrative framework of the PGBAA.