Australia’s largest export industries and regional employers have set out the facts on diesel fuel and the vital fuel tax credits (FTC) system on a new website – fueltaxfacts.com.au – which includes first-hand testimony from businesses and workers about the importance of the system for regional jobs.
The Fuel Tax Credits Alliance includes Australia’s agriculture, forestry, fisheries, maritime, tourism and mining industries, and was established to represent these industries and rebut misleading campaigns claiming FTCs are a subsidy.
FTCs are critical to ensure fair tax treatment for off-road fuel used by regional industries. Diesel is the only choice for many regional businesses operating heavy machinery and operating separately from the electricity grid.
Treasury and several respected economists have repeatedly stated that FTCs are not a subsidy, and FTCs are not considered a tax expenditure by either Treasury or the Productivity Commission.
Any changes to reduce or remove FTCs for any industry would be a new tax on regional Australia at the very time when regional communities need more jobs and opportunities.
The launch of the website is the latest initiative of the Fuel Tax Credits Alliance to bust myths and bogus claims perpetrated by some groups, who refuse to acknowledge the impact of reducing or removing FTCs from job-creating regional industries.
The FTC system is based on the basic tax policy principle that tax should not be imposed on business inputs – the same principle that underpins the GST system through input tax credits.
The FTC system also ensures that fuel excise is not charged on off-road use of diesel or other fuels. It makes no sense to impose a road tax on fuel used off-road on privately funded roads, fishing fleets or to generate electricity in remote areas off the electricity grid.
FTCs are an established part of Australia’s tax system. Exemptions at the pump or rebate schemes for off road use have been in place ever since excise was extended to diesel fuel in 1957. FTCs are also available to all business inputs for all industries, and are claimed by a diverse range of industries including tourism, shipping, manufacturing and construction.
Both major parties have provided public bipartisan support for the FTC system based on the sound policy rationale of the FTC scheme, with Opposition Leader Bill Shorten stating ‘We will keep the diesel fuel rebate for mining companies’ and the Minister for Finance stating that: ‘[T]he government does not consider the diesel fuel rebate as a subsidy at all.’
For comment from Seafood Industry Australia contact Jessica McInerney, Media and Communications Manager, Seafood Industry Australia
M: 040 695 431
For further information on Fuel Tax Credits contact Simon Troeth, Director – Media, Minerals Council of Australia
P: 02 6233 0633
M: 0439 300 335