The Australian Federal Government confirmed a temporary decrease in the tax rate for diesel and petrol fuels from 44.2 cents to 22.1 cents per litre beginning 30/March/2022 and lasting six months till 30/June/2022. These reforms have now become legislation and are in force.
These solutions are intended to relieve family and corporate cost-of-living constraints. This will result in immediate savings on fuel expenses for all our FTC customers during the relevant period. The VIEWTRACK team is pleased to see our clients benefiting from these efforts as strong supporters of the transportation businesses that keep this country moving.
The modifications to Fuel Tax Credits (FTC) have the effect of lowering the FTC rate for Heavy Vehicles using in public roads to zero and the FTC rate for non-public road usage to 22.1 cents per litre during the effective period. These rates have been changed in our partner’s application, and they will be shown in reports beginning in April.
These modifications have some intriguing ramifications. To begin, the Road User Charge (RUC) has not been adjusted, but the excise charged will be less than the RUC throughout the effective time, thus on-road users will effectively benefit from a 4.3 cents per litre reduction in RUC.
Furthermore, because all FTC claims submitted during the effective period will only include off-road and auxiliary usage components, there is an increased emphasis on ensuring that these are as accurate as possible. There are also more intricate residual concerns pertaining to the time of fuel purchase vs the time of use for fuel deliveries spanning the rate change date, which may provide difficulty in particular industries.
Given the abovementioned, now is an excellent moment to assess your fuel consumption, apportionment strategy and structure, purchase arrangements, and tax situations, even retroactively. The VIEWTRACK and our partner’s staff are ready to assist with any technical requirements, and our network of experienced tax partners can aid with any FTC and other tax duties.
More information on the fuel excise adjustments in the budget could be found in this Australian government document here.
You can also find out more details on the ATO website here.
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