Issue
Is the unloading and reloading of logs at a dump within the forest in which they were felled 'forestry' for the purposes of section 35 of the Energy Grants (Credits) Scheme Act 2003 (EGCSA)?
Decision
Yes. The unloading and reloading of logs at a dump within the forest in which they were felled is 'forestry' for the purposes of section 35 of the EGCSA.
Facts
The client is contracted to a harvesting company to manage a log dump in a forest where timber is felled.
Under the forest harvest plan, the forest is divided into coupes, each identified by a number and each harvest team is allocated a number of coupes to harvest.
During summer, the logs are felled in the coupes and snigged out of the coupe (pulled out by a bulldozer or tractors) to a log landing. The log landing is a place beside the road where the snigged logs are placed in readiness for loading onto a truck.
Once loaded onto trucks, the logs are delivered to a large dump within the forest in which the timber was felled. At the dump the client uses diesel powered excavators to unload the logs from the truck and place them in the log dump where they are stored until the winter months.
During the winter months, when it is too wet to cart timber directly from the coupes, the cartage contractors come back to the dump and the client reloads the logs onto the trucks so they can be taken to sawmills.
Reasons for Decision
Subsection 53(1) of the EGCSA says that you are entitled, subject to certain prescribed conditions, to an off-road credit if you purchase diesel fuel for a use by you that qualifies, including forestry. Forestry is relevantly defined in section 35 of the EGCSA as: (a) the planting or tending, in a forest or plantation, of trees intended for felling; or (b) the thinning or felling, in a forest or plantation, of standing timber;
and includes: ... (c) the transporting ... in a forest or plantation, of timber felled in the forest or plantation; or... (e) where the timber is milled at a sawmill or chipmill that is not situated in the forest or plantation in which the timber was felled - the transporting of the timber from the forest or plantation in which it was felled to the sawmill or chipmill.
Under paragraph 35(c) of the EGCSA the 'transporting ... of timber' refers to the conveying or carrying, in a forest or plantation, of felled timber from one place in the forest or plantation where the timber was felled to another place in the same forest or plantation, provided that the entire journey is undertaken entirely within the forest.
Therefore, the transporting of timber for the purposes of paragraph 35(c) of the EGCSA includes the transportation of the felled tree from the floor of the coupe to the log landing and then from the log landing to any other location within the forest (such as a sawmill, chipmill or log dump). The loading and the unloading of the vehicles used for transporting this timber is an integral part of the transportation activity, including in the situation (as here) where the loading and unloading is undertaken by an entity which does not own or operate the transport vehicle.
Similarly, the loading of logs at the log dump onto a transport vehicle, so that they can be transported to a sawmill situated outside the forest, is an integral part of the transportation activity described in paragraph 35(e) of the EGCSA.
Accordingly, the unloading and reloading of logs at a dump within the forest in which they were felled is 'forestry' for the purposes of section 35 of the EGCSA.