Issue
Is an entity which sets and maintains drumlines and nets for the purpose of catching sharks undertaking 'marine transport' for the purposes of section 36 of the Energy Grants (Credits) Scheme Act 2003 (EGCSA)?
Decision
Yes. An entity which sets and maintains drumlines and nets for the purpose of catching sharks is undertaking 'marine transport' for the purposes of section 36 of the EGCSA.
Facts
An entity contracts to a government body to assist with a shark control program.
The entity is required to transport nets and drumlines when setting them, transport equipment for the repair and maintenance of nets and drumlines once set, and transport caught sharks out to sea for disposal or release.
Reasons for Decision
Subsection 53(1) of the EGCSA states that, subject to certain prescribed conditions, an entity is entitled to an off-road credit if they purchase or import into Australia off-road diesel fuel for a use by them that qualifies.
Subsection 53(3) of the EGCSA provides that use in marine transport, in the course of carrying on an enterprise, is a use that qualifies. The phrase 'use in marine transport' is defined in section 36 of the EGCSA to mean a number of activities, including (per subsection 36(2)) 'use in a vessel in marine transport'.
A key step in determining what constitutes 'use in a vessel in marine transport' is to determine the meaning of the term 'marine transport'.
In Re Port of Brisbane Corporation and Deputy Commissioner of Taxation [2004] AATA 222 ( Port of Brisbane ), the Administrative Appeals Tribunal (AAT) considered the meaning of 'marine transport' for the purposes of the Diesel Fuel Rebate Scheme, which was the precursor to the Energy Grants (Credits) Scheme and under which a diesel fuel rebate was payable for diesel fuel purchased for use 'in marine transport'.
In Port of Brisbane , the AAT reasoned at paragraph 31 that: ... the phrase "use in ... marine transport" should be accorded its ordinary and natural meaning. ...
And further at paragraph 32 that: .... In the Tribunal's opinion, the key to the meaning of "marine transport" lies in the meaning of the word "transport". The Concise Macquarie Dictionary (3rd edition 1988) lists as the sixth meaning of transport: 6. a means of transporting, as a ship, truck or plane used for transporting soldiers or military stores or convicts. The first meaning of transport in the Oxford English Dictionary is: 1. the action of carrying or conveying a thing or person from one place to another, conveyance. The use of the word "transport" in the phrase "marine transport" suggests a conveyance - something which does the conveying - a vehicle or vessel or aircraft which moves through its particular medium (land, water, air) carrying a thing or person. The medium in this case is, of course, water. Thus, ... "marine transport" should in this instance be interpreted as meaning the act of conveying a thing...
In this case, the contract for the shark control program requires the entity to: • transport nets and drumlines when setting them • transport equipment for the repair and maintenance of nets and drumlines once set, and • transport caught sharks out to sea for disposal or release.
Each of the above journeys involves the conveyance of things by a vessel on water.
Accordingly, an entity which sets and maintains drumlines and nets for the purpose of catching sharks is undertaking 'marine transport' for the purposes of section 36 of the EGCSA.