Issue
Is the use of diesel fuel in tractors operating on a vessel to load and/or unload cargo onto and from the vessel 'use in marine transport' for the purposes of section 36 of the Energy Grants (Credits) Scheme Act 2003 (EGCSA)?
Decision
Yes. The use of diesel fuel in tractors operating on a vessel to load and/or unload cargo onto and from the vessel is 'use in marine transport' for the purposes of section 36 of the ECGSA.
Facts
An entity purchases diesel fuel to power tractors that load and unload cargo onto and from a vessel in carrying on its enterprise.
The tractors are located on the vessel when they are used to load and unload the cargo.
The vessel remains on the sea water whilst being loaded and unloaded rather than in dry dock.
Reasons for Decision
Subsection 53(1) of the EGCSA provides that an entity is, subject to certain conditions, entitled to an off-road credit if they purchase diesel fuel for a use by them that qualifies.
Under subsection 53(3) of the EGCSA, 'use in marine transport' in the course of carrying on an enterprise is a use that qualifies.
Section 36 of the EGCSA sets out the meaning of the expression 'use in marine transport', which includes various uses.
Subsection 36(3) of the EGCSA provides that: Use: (a) in a vessel, or in equipment in or on a vessel; and (b) while the vessel is in or on the sea or fresh water; and (c) for any of the purposes mentioned in subsection (4); is use in marine transport .
The purposes which qualify as marine transport are outlined in subsection 36(4) of the EGCSA. The relevant purposes are: (a) loading anything onto the vessel, or enabling persons to board the vessel, for the purpose of being transported by the vessel; (b) unloading anything from the vessel, or enabling persons to disembark from the vessel, after being transported by the vessel; (c) ...
In this instance, the tractors are physically on the vessel when loading and unloading cargo onto and from the vessel, whilst the vessel remains on sea water.
Accordingly, the use of diesel fuel in tractors operating on a vessel to load and/or unload cargo onto and from the vessel is 'use in marine transport' for the purposes of section 36 of the ECGSA.