BIODIESEL EXCISE EXEMPTION REFORM - (BEER)

HOME <TBODY>WHAT IS BIODIESEL HOW TO MAKE BIODIESEL EXCISE AND LEGALITIES RELATED INFORMATION Media Contacts: GENERAL Paul Martin Mob: 0415 377 060 Email via website Tony Clark Mob: 0428 920 881 Ph: (08) 9383 5605 Email: Tony LEGAL/TECHNICAL Terry Shulze Mob: 0404 882 714 Email: Terry

EXCISE AND LEGALITIES CLICK HERE for a downloadable, printable version of this information A BUREAUCRATIC NIGHTMARE The present intention of the government is to require those who make homemade biodiesel to - 1. Obtain a licence from the ATO 2. Comply with any conditions in the licence 3. Must not intentionally move the biodiesel without ATO permission 4. Must allow tax officers, at all times, to have complete access to production area 5. Advise the ATO of any changes to their circumstances that may affect the license 6. Keep detailed records of the biodiesel entered for home consumption for a period of five (5) years and be penalised if they can't demonstrate that an entry is correct 7. The records should contain information about: a. the biodiesel used in the manufacture of any blended product b. the process of manufacture c. the quantity of the biodiesel manufactured d. loss or wastage of the biodiesel, or of other goods used in the manufacture of the biodiesel, during or after manufacture e. the storage of the biodiesel, and f. the sale or disposal of the biodiesel. g. the records need to be in English, or easily translated into English, and should include records of the storage and disposal of the biodiesel, the calculation of duty, and your excise returns. 8. Pay excise tax on their homemade biodiesel Most people are stunned to hear of this bureaucratic nonsense, but it is all true. You can find copies of the text of the actual brochures from the ATO called LICENSING and MY OBLIGATIONS at the end of this essay. HOMEMADE BEER There is an Excise Tax exemption for people who want to make homemade beer. It is contained in the Schedule for the Excise Tariff Act 1921 and states - "Tariff items 1 and 2 of this Schedule do not include any liquor which has been produced for non-commercial purposes, using non-commercial facilities and equipment, other than a liquor which is, or which contains, any spirit obtained by distillation." This simple paragraph removes homemade beer from the Schedule of excisable goods. Because homemade beer is not an excisable good, it does not have to comply with all the above requirements that are proposed for homemade biodiesel. We want homemade biodiesel to have the same type of exemption. HOMEMADE BIODIESEL In order for homemade biodiesel to have the same type of exemption as homemade beer, all that is required is for this paragraph to be inserted into the Schedule for the Excise Tariff Act 1921 - "Tariff items 11 and 12 of this Schedule do not include any biodiesel which has been produced for non-commercial purposes, using non-commercial facilities and equipment." That's it, it is all very easy. The homemade biodiesel exemption is modeled on the homemade beer exemption and uses virtually the same language. Any bill that comes into the house of representatives or the senate to do with excise laws can be used as a means to introduce the amendment to the Excise Tariff Act. We need the government or a majority in the senate to pass the amendment. ________________________________________________________________________ THE TEXT OF THE ATO'S BROCHURES LICENSING What is an excise licence for biodiesel? An excise licence allows you to conduct certain activities in relation to excisable products - such as manufacture or storage. There are two types of licences relevant for biodiesel: an excise manufacturer's licence - this allows you to manufacture and store biodiesel, and a licence to store excisable goods - this allows you to store biodiesel. Who needs an excise licence for biodiesel? You need to hold the relevant excise licence if you intend to conduct, or are conducting any of the following: -manufacturing biodiesel for personal or commercial use in diesel engines - blending or storing biodiesel (blending is considered to be manufacture) for use in diesel engines, or - blending duty paid biodiesel with any other fuel for use in diesel engines. How do I apply for and obtain an excise licence? If you are conducting any of the above activities, or you already have an excise licence and are not sure if it covers biodiesel you should contact us on 1300 137 292. One of our staff will discuss your individual circumstances with you to assist you in deciding the type of licence you need to apply for. We will then send you the relevant forms for you to complete. There is no charge for obtaining a licence. If you require assistance in completing your licence documentation or have any questions, phone 1300 137 292. Is a licence issued automatically? No. The Excise Act sets out the matters that we consider when making a decision. After forms have been checked to ensure they are complete, background checks are carried out to assist us in making a decision on your application. During the licensing process one of our staff may need to phone you to obtain further information. How long does the licensing process take? You will have a response from us within 28 days after we have received all necessary information from you. When a decision has been made we will phone to advise you of our decision. If we approve your application you will receive your licence documentation by post. If we refuse your application we will also write to you explaining our decision. What if I am already making biodiesel? If you are already making biodiesel you should contact us as soon as possible to start the licensing process. Under the Excise Act you have two months from the date that biodiesel becomes excisable to become licensed. This means you must have applied for an excise licence by 17 November 2003. The provision stipulates that if you are manufacturing biodiesel in this period without a licence you can continue to manufacture. However, you must act as if you are a licensed person and comply with your obligations under the Excise Act. If you are already manufacturing biodiesel without a licence we encourage you to contact us as soon as possible so we can assist you in complying with your obligations. The Excise Act allows for heavy penalties to be imposed on unlicensed excisable activities. How long is my licence valid for? Manufacturer's licences expire on 31 December of each year regardless of when they are issued, and need to be renewed annually. We will contact you before your licence expires to invite you to renew. --- MY OBLIGATIONS If you are a licence holder you must comply with the conditions stipulated in your license(s) as well as in the relevant legislation. In addition you must comply with the following requirements. Control of excisable goods All excisable goods are subject to our control until delivered for home consumption or for exportation. You must not intentionally move, alter or interfere with the goods without our permission. Safety of the goods and excise liability If you do not keep excisable goods safely or fail to account for the goods in your possession, custody or control, to our satisfaction, you will be required to pay an amount equivalent to the excise duty on those goods. This amount will be equal to the amount of excise duty which would have been payable if the goods had been entered for home consumption on the day the deficiency was found. Tax officer right of entry You must allow tax officers, at all times, to have complete access to every part of any factory, approved place or premises specified in a licence. Tax officers may also examine and take account of excisable goods in these factories, approved places or licensed premises. Keep us informed You have an obligation to advise us of any changes to your circumstances that may affect the basis on which your licence was granted, for example - a change to your premises. What other documentation will I require? Depending on your specific circumstances you may require any of the following: - movement permission - periodic settlement permission, and - excise return. Movement permission A movement permission authorises the movement of goods, subject to the Commissioner's control, from one licensed establishment to another, without entering them for home consumption. There are two types of movement permissions: - a continuous permission - this allows transfer of product between two entities on a continuous basis, and - a single permission - this allows the transfer of product on a one off basis. In both situations the excise liability is transferred from the selling party to the buying party. This movement is also known as an under bond movement. Based on the information provided in your initial discussion with us, you may be approved to apply for a continuous permission. Periodic settlement permission A periodic settlement permission is a legislative mechanism granted to clients enabling the delivery of excisable products into home consumption. The permission stipulates the time period in which you may deliver these products before making an entry. Payment of the appropriate excise duty is to be made on the date of entry. We will issue a permission with the appropriate settlement period based on the nature of your operations. For the purposes of biodiesel these may be weekly, quarterly or annual settlement periods. If you do not hold a permission, you will be required to obtain a delivery authority with the payment of excise duty required before the product enters home consumption. Payment prior to clearance Payment prior to clearance is required if you have not been granted periodic settlement permission. In this instance you are required to seek our permission to deliver the goods before actually doing so. You need to do this each time you want to deliver goods into home consumption. The permission issued to you will be in the form of a numbered delivery authority. Payment of your excise duty is required before the goods have been delivered into home consumption. Record keeping obligations You must keep detailed records of the biodiesel entered for home consumption for a period of five (5) years so you can provide evidence to substantiate your returns if you are audited. You may be penalised if you can't demonstrate that an entry is correct. Your records should contain information about: - the biodiesel used in the manufacture of any blended product - the process of manufacture - the quantity of the biodiesel manufactured - loss or wastage of the biodiesel, or of other goods used in the manufacture of the biodiesel, during or after manufacture - the storage of the biodiesel, and - the sale or disposal of the biodiesel. Your records need to be in English, or easily translated into English, and should include records of the storage and disposal of the biodiesel, the calculation of duty, and your excise returns. More information If you are unsure of any aspects of the information you may need to provide to support your entries, you should phone 1300 137 292. ______________________________________________________________________ ______________________________________________________________________ For information on the excise and legal requirements for biodiesel production, please visit the following sites: ATO biodiesel info line: 1300 657 162 Overview of excise on biodiesel http://www.ato.gov.au/businesses/content.asp?doc=/content/38323.htm Obligations of licensed biodiesel producers http://www.ato.gov.au/businesses/content.asp?doc=/content/38360.htm Home consumption http://www.ato.gov.au/businesses/content.asp?doc=/content/38362.htm Excise license for Biodiesel http://www.ato.gov.au/businesses/content.asp?doc=/content/38181.htm Making an excise payment http://www.ato.gov.au/businesses/content.asp?doc=/content/38363.htm A link to the PM's announcements on excise http://www.pm.gov.au/news/media_releases/media_Release624.html