Private ruling: Fuel tax credits - road user charge
Published: December 2014
Ruling period: From 1 July 2013 to 30 June 2014 | From 1 July 2014 to 30 June 2015 | From 1 July 2015 to 30 June 2016
Date scheme commenced: 1 July 2013

Ruling: Q1: Are you eligible to claim the full fuel tax credit (not reduced by the road user charge) for fuel used in your vehicles for travelling roads within the Council Lands? | A1: Yes | Q2: The taxpayer asked if they claim an additional amount of fuel tax credit for the amount of road user charge previously deducted? | A2: Yes, the taxpayer may claim and additional amount of fuel tax credit for the amount of road user charge, however they also must reduce the fuel tax credit entitlement by the amount of carbon reduction for the fuel.

Relevant facts and circumstances: This ruling is based on the facts stated in the description of the scheme that is set out below. If your circumstances are materially different from these facts, this ruling has no effect and you cannot rely on it. The fact sheet has more information about relying on your private ruling. You provide transport services to remote indigenous communities. Your services are provided on a periodic basis dependant on demand. These remote communities are part of the Council lands. The roads on community lands are maintained by the Shire and Council using their own earthmoving equipment. The lands are subject to a native title determination. The determination recognises the right of possession, occupation, use and enjoyment to the exclusion of all others of the lands within the Lands Part A and Part B Determination areas. Item 6 of the Determination states that the native title rights and interests are: • exercisable in accordance with the traditional laws and customs of the native title holders; and • subject to the laws of the state and the Commonwealth including the common law Schedule 4 of the Determination recognises other interests in relation to the Determination area such as reserves, mining leases, exploration licences, leases and sub-leases, access to mining interest areas and the right of any person to use (subject to the laws of the State, in particular the Aboriginal Affairs Planning Authority Act 1972 ) the central road and any other road in the determination area over which the public has a right of way at the time the determination was made. The Aboriginal Affairs Planning Authority Act 1972 (AAPA Act) provides a legislative basis for the establishment and management of reserve lands. The Act established the Aboriginal Affairs Planning Authority, also known as the Department of Aboriginal Affairs whose duty is to promote the well-being of persons of aboriginal descent in an Australian state. The authority uses Indigenous Land Use Agreements to prevent activities on Aboriginal Lands Trust Land, such as leasing arrangements and public works by government agencies, from extinguishing native title. The department also supports the work of the Aboriginal Lands Trust. The Aboriginal Lands Trust was also established by the AAPA Act. The Trust manages the physical and built environment of the lands. Section 30 in Part III of the AAPA Act provides for the right of control in reserved lands and states that no application for a grant in any interest, licence, right, title or estate under any Act which would operate in relation to any land to which Part III of the Act applies shall be: • refused without prior consent of the Authority • processed except in consultation with the Authority • taken to be approved unless the approval is granted by the Authority. Section 31 of the AAPA Act provides that a person that enters or remains on any land to which Part III of the AAPA Act applies, or is shown to have been within the boundaries of that land, is guilty of an offence. A permit is legally required under Part III of AAPA Act , by any person visiting or passing through an aboriginal reserve unless he/she is: • a person of aboriginal descent; • a member of either house of Parliament of the State or of the Commonwealth; • a person lawfully exercising a function under the Aboriginal Affairs Planning Authority Act 1972 or otherwise in pursuance of a duty imposed by law; or • a person authorised in that behalf under the regulations of the Aboriginal Affairs Planning Authority Act 1972. Access to the Lands is gained through an entry permit under the AAPA Act. An entry permit under the Act will not be granted without consent of the Council. The Council may in its discretion grant permission subject to such terms and conditions and restrictions as it sees fit, or refuse permission. Such conditions include: • you must carry your permit in your vehicle while on Aboriginal reserve land • you must not leave the established road unless you have specific permission to do so • travel through the reserve land as quickly as possible. • The permit is only valid for the purpose and dates specified Section 7 of The Aboriginal Communities Act 1979 (WA) allows the Council of a community to make by-laws relating to community lands of the community with respect to various issues including motor vehicles. Subsection 7(b) of The Aboriginal Communities Act 1979 allows a community to make by-laws with respect to the prohibition or regulation of the use of motor vehicles on community lands including provisions to speed, manner of driving, class of vehicles, routes, entrances and exits, one-way traffic, noise, parking or standing, the removal of vehicles by a person authorised under the by-laws and for the control of traffic generally. Section 3 in Part B of the Council (Aboriginal Corporation) By-laws under the Aboriginal Communities Act 1979 restricts entry onto community land to members of the community unless prior permission has been granted by the governing committee of the Council. Section 4 in Part B of the By-laws makes it an offence to enter community lands without permission. The roads within the Council lands are maintained by the Shire and Services, including the central road, which forms part of the outback way, a major route through to the National Park. The Shire tenders the work to contractors. Major roads are maintained by the Shire as well as access roads to the communities within the Shire.

Relevant legislative provisions: Fuel Tax Act 2006 Section 41-5, | Fuel Tax Act 2006 Subsection 43-10(3), | Fuel Tax Act 2006 Subsection 43-10(4), | Fuel Tax Act 2006 Paragraph 43-8(4)(c), | Aboriginal Affairs Planning Act 1972 (WA) Section 30, | Aboriginal Affairs Planning Act 1972 (WA) Section 31, | Aboriginal Communities Act 1979 (WA) Section 7 and | Aboriginal Communities Act 1979 (WA) Paragraph 7(b).

Reasons for decision: Summary: Section 41-5 of the Fuel Tax Act 2006 (FTA) provides that you are entitled to a fuel tax credit for taxable fuel that you acquire or manufacture in, or import into, Australia to the extent that you do so for use in carrying on your enterprise. The amount of your fuel tax credit is reduced, in accordance with subsection 43-10 of the FTA, to the extent that your taxable fuel is acquired for use in a vehicle, for travelling on a public road, by the amount of the road user charge for the fuel. Public roads are not defined in the FTA; however, the Commissioner's view of what constitutes a public road is discussed in Fuel Tax Ruling FTR 2008/1 Fuel tax: vehicle's travel on a public road that is incidental to the vehicle's main use and the road user charge. The Commissioner's view is that for the purposes of subsection 43-10(3) and 43-10(4) of the FTA a road is a public road if; • it is opened, declared or dedicated as a public road under a statute; • it is vested in a government authority having statutory responsibility for the control and management of public road infrastructure; or • it is a dedicated as a public road at common law. A public road encompasses any shoulder of the road and auxiliary lanes, for example emergency lanes. The following roads are not public roads for the purposes of subsections 43-10(3) and 43-10(4) of the FTA: • a road constructed or maintained under a statutory regime by a public authority that is not an authority responsible for the provision of road transport infrastructure, in circumstances where the statutory regime provides that public use of, or access to, the road is subordinate to the primary objects of the statutory regime; or • a road that has not been dedicated as a public road over privately owned land. | Detailed Reasoning - Opened, declared or dedicated as a public road under statute: The Council and Shire administer indigenous lands held in Trust by the Aboriginal Lands Trust. The Council website states that other than the specified central roads are referred to as access roads. These access roads are referenced by the name of the Community that they provide access to. The informal nature of the naming of the access roads supports the view that access roads were not necessarily required to be opened, declared or dedicated under statute. | Detailed Reasoning - Vested in a government authority having statutory authority for public roads for the control and management of public road infrastructure: Section 30 in Part III of the AAPA Act provides for the right of control in reserved lands and section 31 restricts access to the lands. A permit subject to strict conditions is legally required under Part III of the AAPA Act by any person visiting or passing through an aboriginal reserve unless he/she is: • a person of aboriginal descent; • a member of either house of Parliament of the State or of the Commonwealth; • a person lawfully exercising a function under the AAPA Act or otherwise in pursuance of a duty imposed by law; or • a person authorised in that behalf under the regulations of the AAPA Act. A person that enters or remains on any land to which Part III of the AAPA Act applies, or is shown to have been within the boundaries of that land without a permit is guilty of an offence. The traditional owners are responsible for providing the entire regional infrastructure. The roads within the lands are maintained by the traditional owners by means of the Shire and Council who tender the work out to contractors. We consider that the roads within the Council lands have not been vested in a statutory authority that has responsibility for the control and management of public road infrastructure. | Detailed Reasoning - Dedicated as a public road at common law: If a road is not under the control and management of a state or territory authority which is responsible for the provision of road infrastructure to the public, then whether a road is a 'public road' under the common law is a question of fact. In order to establish that a road has been dedicated as a public road at common law, there must be established an 'unequivocal indication of the intention of the owner of the land to dedicate it to the public as a road'. To establish whether a land owner has dedicated a road as a public road under the common law, some of the matters to be considered are; • whether there has been a declaration of an intention to dedicate; • delineation on maps or plans of roads set apart for public use; • use by the public; • whether vehicles must be registered to use the road and state or territory traffic laws are applicable while the vehicles use the road; or • the expenditure of money by public bodies in forming or maintaining the land as a road. Considered with all the relevant evidence, the above matters may amount to an unequivocal indication of the intention of the owner to dedicate it to the public as a road. Where that dedication is accepted by the members of the public as such, the road is a public road. Use by public Part III of the AAPA Act provides for the right of control over community lands and in conjunction with the regulations a person of non-aboriginal descent may make an application for permission to enter and travel through community lands. Permission may be given conditionally or subject to certain requirements. This restriction of access is also set out in the Community by-laws. Section 4 in Part B of the By-laws makes it an offence to enter community lands without permission. Schedule 4 to the Native Title Determination recognises the right of any person to use the central road and any other road in the determination area over which the public has right of way at the time the determination was made, subject to the laws of the Australian state and in particular the AAPA Act and Regulations. On that basis it is clear that although the public may have access over the roads within the lands, that right of way is tempered by the requirements of the AAPA Act and regulations. Even access by those persons exempt from requiring a permit is not completely unfettered as access is specifically granted by the Act to: • a person lawfully exercising a function under the AAPA Act or otherwise in pursuance of a duty imposed by law; or • a person authorised in that behalf under the regulations of the AAPA Act. Unfettered access is limited to: • a person of aboriginal descent; • a member of either house of Parliament of the State or of the Commonwealth. The central road lies within the lands. Never the less that section of the central road within the lands is maintained by the Council and the public requires a permit to travel through the lands using the road. This confirms that although the public has a right of way over the roads within the Council Lands, in particular the central road, that right of way is subject to permission being granted by the traditional owners subject to the requirements of the AAPA Act and Community By-laws. For the purposes of the FTA, an owner of private property may permit members of the public to pass over the property. A person may lawfully enter private land where the person has an express or implied invitation, licence, permission, lawful authority or consent of the person in possession of the land. A person who initially enters land with lawful authority becomes a trespasser if the consent of the owner is revoked. The use of a road over private land by members of the public does not create a public road, notwithstanding that the owner of the land does not hinder the use of the road by the public. Private land cannot become a public road without an effective act of dedication by the owner. Clearly by restricting entry into the lands by legislation and requiring permits for entry onto the lands the roads were not dedicated as public roads for the purposes of the FTA. Whether vehicles must be registered to use the road and state or territory traffic laws are applicable while the vehicles use the road Although the Council can make By-laws with respect to the use of motor vehicles and the control of traffic generally, no such by-laws are included in the Council (Aboriginal Corporation) By-laws. However, applications for permits for transit through the lands do require applicants to specify details of their vehicles including registration and state of registration. The right of access to the central road or any other road within the determination areas on issue of a permit is subject to the laws of the State and in particular the AAPA Act. We therefore consider that vehicles must be registered to use the roads and subject to the type and condition of the road, state traffic laws are applicable. Whether there has been a declaration of an intention to dedicate The control of all Council Lands is vested in the communities within the lands and co-ordinated by the Council and Shire. The legislative requirement for access to and transit through the lands indicates that it is unlikely there has been a declaration of an intention to dedicate any of the roads within the Council lands as public roads. | Detailed Reasoning - Conclusion: In view of all the evidence we consider that the roads within the Lands, including that part of the central road that falls within the lands, are not public roads although the public enjoys a right of way over these roads subject to the AAPA Act. Accordingly the fuel used in your vehicles for travelling on these roads is not subject to the road user charge. | Detailed Reasoning - Detailed reasoning: During the period 1 July 2013 to 30 June 2014 the fuel tax credit for taxable fuel was reduced by the amount of the carbon reduction. This is because paragraph 43-8(4)(c) of the FTA did not apply to exempt the application of carbon reduction for the taxable fuel used in vehicles while they were not travelling on public roads. Therefore, whilst you have an additional amount of fuel tax credit, to the extent of the road user charge; you must nevertheless take into account the amount of carbon reduction. The rate of fuel tax credit, taking into account the carbon reduction, for taxable diesel fuel used in your vehicles, travelling other than on public roads, for the period 1 July 2013 to 30 June 2014, is 31.622 cents per litre (please refer to our website for the published rates). The Commissioner of Taxation has issued Determination FTE 2013/1: Fuel Tax: Correcting Fuel Tax Errors Determination 2013 which allows you to correct mistakes made to the amount of fuel tax credit previously claimed in the current tax period. This is provided the correction is made in a tax period that falls within four years of the earlier tax period in which the credit was claimed.