Explanatory Memorandum
(Circulated by authority of the Treasurer, the Hon Peter Costello, MP)Chapter 4 - Providing licensing information
Outline of chapter
4.1 This chapter explains an amendment to the Excise Act 1901 that enables information about licences, permissions and remission arrangements to be made available to a second person where disclosure is considered necessary to ensure compliance with the requirements of the Act. [Schedule 4, items 1 to 3]
Context of amendments
4.2 The Excise Act 1901 has a comprehensive licensing system for the production of, and dealing in, tobacco and the manufacture and storing of excisable goods generally and provides for licences to be suspended or cancelled under certain circumstances. In addition, there are controls, through permission requirements and offences for contravening these requirements, over the movement and possession of tobacco seed, plant and leaf and other excisable goods. Licences or permissions may be subject to certain conditions such as restriction to specified quantities of goods.
4.3 The excise legislation confidentiality provisions prevent the Australian Taxation Office (ATO) from disclosing information about excise licences and permissions to a second person also dealing with the goods under the excise legislation.
4.4 Information on whether a person is licensed or has a permission to deal with particular goods or quantities of goods is at times a prerequisite for a second person to comply with the provisions of the legislation. The problem is illustrated in the illicit trade in tobacco, which poses a significant risk to the revenue base. It is an offence for a person to buy tobacco seed, leaf or plant from an unlicensed producer, manufacturer or dealer. However, the ATO is unable to provide information about licence status and conditions. Therefore, a tobacco cooperative with a dealer's licence cannot be advised whether a member is licensed as a producer or when a member's licence is cancelled or suspended. A tobacco grower cannot be informed if the company to which tobacco is to be sold is licensed.
4.5 Where a licence is cancelled, it may be necessary to amend or cancel permissions held by suppliers for the movement of goods to the persons whose licence has been cancelled. Currently, the ATO cannot give the permission holder information relating to the cancelled licence despite the fact it will need to amend or cancel the permission.
4.6 There are also disclosure issues around remission certificates, which are administrative documents stating that the holder may obtain quantities of excisable goods from a supplier according to conditions set out in a regulation. These conditions normally allow the holder to obtain goods at concessional or duty free rates, for example, alcohol for industrial purposes. A supplier to a remission certificate holder may need to be informed that a remission certificate has been amended or cancelled.
Summary of new law
4.7 The amendment alters the confidentiality provisions in section 159 to allow information relating to licences, permissions and remissions arrangements to be disclosed to a second person where the disclosure is considered necessary to ensure compliance with the excise legislation.
Comparison of key features of new law and current law
| New law | Current law |
|---|---|
| Licence, permission or remission arrangement information may be disclosed by the Commissioner or Deputy Commissioner (or authorised delegate) to a second person dealing, or proposing to deal, with the goods to which the information relates to ensure dealings with the goods are in accordance with the Excise Act 1901. | Licence, permission or remission information is not included in the specified circumstances for disclosure of protected information. |
Detailed explanation of new law
4.8 New subsection 159(3A) enables the Commissioner or Deputy Commissioner (or person authorised by Commissioner or Deputy Commissioner) to disclose protected information about whether a person holds a licence under the Excise Act 1901 and the details and conditions of the licence, has a permission under that Act to move goods and details and conditions of such permission, or is allowed a remission of excise duty in relation to a class of goods and details and conditions of the remission.
4.9 Disclosure is permitted to a second person dealing, or proposing to deal, with the goods that may be covered by a licence, permission or remission arrangements where the entrusted person forms the opinion that the disclosure is necessary to ensure the dealing, or proposed dealing, is in accordance with the legislation.
4.10 A reference to a person is taken to include a reference to an unincorporated association or other body. [Schedule 4, item 2]
Application and transitional provisions
4.11 Schedule 4 commences on the day after the bill receives Royal Assent.
Copyright notice
© Australian Taxation Office for the Commonwealth of Australia
You are free to copy, adapt, modify, transmit and distribute material on this website as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).
