Issue
Is an off-road rebate payable under paragraphs 78A(1)(ab) or (ac) of the Excise Act 1901 (Excise Act) for diesel fuel used in refrigerated containers travelling by rail or on vessels?
Decision
Yes, an off-road rebate is payable under paragraphs 78A(1)(ab) or (ac) of the Excise Act for diesel fuel used in refrigerated containers travelling by rail or on vessels.
Facts
An entity owns and operates refrigerated containers that are transported either by trains between two Australian States or directly via ship between two Australian ports, as part of the entity's enterprise. The refrigeration mechanisms on the containers run on diesel fuel. The refrigerated containers are not involved in any transport relating to forestry.
Reasons for Decision
Subsection 78A(1) of the Excise Act says: 'A rebate is,... payable to a person who purchases diesel fuel for use by him or her: ... (ab) in rail transport... in the course of carrying on an enterprise; (ac) in marine transport... in the course of carrying on an enterprise;...'
Subsection 78A(7) of the Excise Act states that 'rail transport' and 'marine transport' have the same meanings as in subsection 164(7) of the Customs Act 1901 (Customs Act). Subsection 164(7) of the Customs Act states: 'Marine transport includes transport by vessel in or on fresh water, but does not include any transport relating to forestry. ..... Rail transport includes light rail transport and transport by tram, but does not include any transport relating to forestry.'
As the terms rail transport and marine transport are not exhaustively defined in the legislation, the terms should be given their ordinary meanings as modified by the definitions in subsection 164(7) of the Customs Act. Paragraphs 78A(1)(ab) and (ac) of the Excise Act refer to use 'in rail transport' and 'in marine transport'. Both of these paragraphs connote active involvement in transport which is relevantly defined in the Macquarie Dictionary (3rd Ed) as the 'act or method of transporting or conveying'.
Diesel fuel purchased for use in refrigerated containers travelling by rail or on vessels is considered to be within the ordinary meaning of the terms rail and marine transport. Therefore, a rebate is payable from the time a refrigerated container arrives at the departure point to the time the container leaves the destination point. For rail, departure and destination points include railways, tramways, light rail networks, rail or tram freight terminals, storage depots and similar rail transport facilities or infrastructures. For marine, departure and destination points include waterways, ports, docks, marine freight terminals, marinas or similar marine transport facilities or infrastructures.