Issue
Is a street sweeper with a Gross Vehicle Mass (GVM) of less than 4.5 tonnes travelling on a public road for the purposes of section 41-20 of the Fuel Tax Act 2006 (FTA) while engaged in road maintenance being the sweeping and collecting debris from public roads?
Decision
No. A street sweeper with a GVM of less than 4.5 tonnes is not travelling on a public road for the purposes of section 41-20 of the FTA while engaged in road maintenance being the sweeping and collecting debris from public roads.
Facts
The entity acquires taxable fuel for use in carrying on its enterprise, including for use in a street sweeper with a GVM of less than 4.5 tonnes.
A street sweeper is designed to perform a number of functions from parking lot cleaning to road maintenance. The entity operates the street sweeper to conduct maintenance of public roads.
The street sweeper carries out road maintenance activities by using fitted brushes to sweep the public road and collect debris by vacuuming.
Reasons for Decision
Under section 41-5 of the FTA an entity is entitled to a fuel tax credit for taxable fuel that it acquires, manufactures, or imports into Australia to the extent that it does so for use in carrying on its enterprise.
Subdivision 41-B of the FTA provides a number of disentitlement rules for fuel tax credits.
One of the disentitlement provisions, in section 41-20 of the FTA, is that an entity is not entitled to a fuel tax credit for taxable fuel used in a vehicle with a GVM of 4.5 tonnes or less travelling on a public road. This rule is modified by item 12 of Schedule 3 to the Fuel Tax (Consequential and Transitional Provisions) Act 2006 which extends entitlement to diesel vehicles with a GVM of 4.5 tonnes provided they were acquired before 1 July 2006.
As the entity's road sweeper has a GVM less than 4.5 tonnes, it will be ineligible for a fuel tax credit while it is travelling on a public road.
The FTA does not define the term 'travelling'.
The terms 'travel' and 'travelling' were considered in Fuel Tax Ruling FTR 2008/1. The terms are defined in paragraph 14 of FTR 2008/1 as the going from one place to another place or moving from one point to another point.
FTR 2008/1 explains that the movement of a vehicle engaged in road construction, repair or maintenance to and from a road work site is 'travelling' for the purposes of the FTA. However, 'travelling' does not include the movement of a vehicle on a public road while the vehicle is engaged in construction, repair or maintenance of the road.
The Commissioner considers that the movement of a street sweeper whilst engaged in road maintenance (in this case, sweeping and vacuuming) is not 'travelling' on a public road.
Applying these principles, the street sweeper is considered to be 'travelling' when it leaves the depot or a waste disposal station up until the point when it commences maintenance activities on the road. Travel recommences when the street sweeper ceases sweeping and vacuuming the road and begins its return to the depot or a waste disposal station.
As 'travelling' does not extend to the movement of a vehicle engaged in maintenance on a public road, the street sweeper is not 'travelling' for the purposes of section 41-20 of the FTA while it is sweeping, vacuuming and collecting debris from public roads.