Issue
Where an entity conducts an enterprise of running a show at particular premises, is the principal purpose of the show enterprise the retail sale of services (other than electricity) for the purposes of subparagraph 53(4)(a)(i) of the Energy Grants (Credits) Scheme Act 2003 (EGCSA)?
Decision
Yes. Where an entity conducts an enterprise of running a show at particular premises, the principal purpose of the show enterprise is the retail sale of services (other than electricity) for the purposes of subparagraph 53(4)(a)(i) of the EGCSA.
Facts
An entity carries on an enterprise operating a show.
The entity uses diesel fuel at certain premises, namely the show site, to generate electricity.
The show is conducted as a special event to allow people to view various exhibitions, trade stalls and various types of entertainment.
The entity charges an entry fee for the show.
Reasons for Decision
Subsection 53(1) of the EGCSA states that a person is entitled to an off-road credit if they purchase diesel fuel for a use by them that qualifies.
Paragraph 53(4)(a) of the EGCSA provides that the following is a use that qualifies: (a) use at particular premises to generate electricity for use in the course of carrying on, at those premises, an enterprise that: (i) has, as its principal purpose, the retail sale of goods or services (other than electricity) or the provision of hospitality; and (ii) does not have, at those premises, ready access to a commercial supply of electricity.
Subparagraph 53(4)(a)(i) of the EGCSA makes it clear that, in order to qualify, the principal purpose of the enterprise carried on at the particular premises must be the retail sale of goods or services (other than electricity) or the provision of hospitality.
The Macquarie Dictionary, 2001, rev. 3rd edn, The Macquarie Library Pty Ltd, NSW defines 'service' as: the supplying or supplier of any articles, commodities, activities, etc., required or demanded... to meet the needs of (a group of people or organisation) by providing a particular service...
The entity is supplying an activity, namely the show's exhibition, trade displays, and entertainment. The entity is clearly providing a service at the show premises. As the entity charges an entry fee, it can be said that the entity sells the service.
As the show is conducted as a special event to allow people to view various exhibitions, trade stalls and various types of entertainment, it is clear that the primary purpose of the enterprise carried on at the show premises is the retail sale of services.
Accordingly, where an entity conducts an enterprise of running a show at particular premises, the principal purpose of the show enterprise is the retail sale of goods or services (other than electricity) for the purposes of subparagraph 53(4)(a)(i) of the EGCSA.