Changes to fuel tax credits

Fuel tax credits provide a credit for any fuel tax (excise or customs duty) included in the price of fuel used in business activities, machinery, plant and equipment or heavy vehicles.

From July 1, 2013, most fuel tax credit rates were reduced by a carbon charge introduced under the new Clean Energy Laws.

For most businesses, the correct rate to apply as of July 1, 2013 will be the rate in effect on the day the fuel was purchased. Businesses with heavy vehicles travelling on public roads will continue using the rate in effect when completing their Business Activity Statements (BAS).

The carbon charge will not affect the fuel tax credit rates for renewable fuels or fuels used in:

• Heavy vehicles travelling on public roads;
• Specified activities in the agriculture, fishing or forestry industries; and
• Industries that do not involve the combustion of the fuel.

For those industries that are affected by the carbon charge, the following rates will apply for liquid fuels:

Examples of business use	Fuel type	For fuel acquired from July 1, 2013
Mining Nursing and medical Electricity generation Construction Manufacturing Property Management Landscaping	Petrol	32.347 cents per litre
	Diesel and other liquid fuels	31.622 cents per litre
Supply of fuel for domestic heating	Heating oil and kerosene	31.622 cents per litre

The current fuel tax credit rate for heavy vehicles travelling on public roads from July 1, 2013 is 12.003 cents per litre.

Click here to access the Tax Office guide on fuel tax credits.