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Is the use of a loader on agricultural properties to load manure from dairies and straw from piggeries onto a truck for removal from the property an 'agricultural waste activity' as defined in section 26 of the Energy Grants (Credits) Scheme Act 2003 (EGCSA)?

Yes. The use of a loader on agricultural properties to load manure from dairies and straw from piggeries onto a truck for removal from the property is an 'agricultural waste activity' as defined in section 26 of the EGCSA.

An entity collects manure and straw from various agricultural properties where the agricultural activity of rearing livestock is carried on.

The entity uses diesel-powered loaders to load the waste onto trucks for removal from the agricultural properties. The entity then composts these products and uses them to manufacture fertiliser.

Under the energy grants credits scheme an entity is entitled to an energy grant if it purchases diesel fuel for use by it in defined activities, including agriculture. 'Agriculture' is defined in section 22 of the EGCSA and includes an 'agricultural waste activity', which is in turn defined in section 26 of the EGCSA which states: The expression agricultural waste activity means: (a) the removal of waste products of an agricultural activity from the agricultural property where the activity is carried on; or (b) the disposal of waste products of an agricultural activity on the agricultural property where the activity is carried on

As the products are not being disposed of on the agricultural properties, paragraph 26(b) of the EGCSA of the above definition is not relevant. Therefore, the activities will be an 'agricultural waste activity' if: • the manure and straw are 'waste products of an agricultural activity' • the loading of the truck constitutes the removal of such products; and • the waste products are being removed from the agricultural property where the agricultural activity they resulted from is carried on.

Each requirement will be considered in turn.

In Water Administration Ministerial Corporation v. CEO of Customs N96/1212 AAT No 12111, the Administrative Appeals Tribunal said that a waste product can be described as something that is an excess material, or is unproductive and superfluous. The concept of waste embraces all unwanted and economically unusable or rejected by-products at any given time, and any other matter which may be discharged, accidentally or otherwise to the environment.

Agricultural activity is defined in section 28 of the EGCSA as meaning:

An activity referred to in any one of the paragraphs of the definition of agriculture in subsection 22(1) of the EGCSA (other than an activity referred to in paragraph (i) or (j) of the definition of sundry agricultural activity in section 27 of the EGCSA) if that activity is carried out for the purposes of, or purposes that will directly benefit, a business undertaken to obtain produce for sale.

The definition of 'agriculture' in subsection 22(1) of the EGCSA includes, among other things, the activities of 'cultivation of the soil', 'cultivation and gathering in of crops', 'rearing of livestock', 'horticulture', 'viticulture', 'pasturage' and 'apiculture'. It also includes live-stock activities, which are defined in subsection 23(1) of the EGCSA to mean (among other things) the milking of live-stock.

Used straw and manure are waste products of the agricultural activities 'rearing of livestock' and 'milking of live-stock'' (which as discussed above is a live-stock activity and therefore an agricultural activity).

The fact that someone other than the farmer may at some later time reuse a product discarded as waste by the farmer does not necessarily preclude it from being waste. Therefore, in this instance the manure from dairies and straw from piggeries discarded by the farmer and removed as waste from the agricultural property, and subsequently used to manufacture fertiliser for sale, would still be regarded as the waste product of an agricultural activity.

Removal in the context of paragraph 26(a) of the EGCSA means the taking away, or the movement of the waste product from the agricultural property. The loading of the waste product onto trucks which will take the waste from the agricultural property is part of this removal process.

As the straw and manure are the waste products of agricultural activities and are being removed from the agricultural property where this activity is carried on, this test is met.

As all the requirements are met, the use of a diesel-powered loader to load waste products of an agricultural activity onto trucks for removal from the agricultural property is an 'agricultural waste activity' as defined in section 26 of the EGCSA.