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Excise Amendment (Compliance Improvement) Bill 2000

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1998-1999-2000

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

HOUSE OF REPRESENTATIVES

 

 

 

excise amendment (compliance improvement) bill 2000

 

 

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

(Circulated by authority of the

Treasurer, the Hon Peter Costello, MP)

 



T able of contents

General outline and financial impact.............................................. 1

Chapter 1      Overview.................................................................... 3

Chapter 2      Licensing for excise purposes................................ 9

Chapter 3      Control of tobacco seed, plant and leaf............... 29

Chapter 4      Other measures to improve compliance.............. 37

Chapter 5      Regulation impact statement................................. 43

Index                                                                                                 47



Excise Amendment (Compliance Improvement) Bill 2000

This Bill amends the Excise Act 1901 to strengthen the provisions that regulate the production, dealing, manufacturing and storage of tobacco, in particular, and excisable goods generally. The measures are designed to provide a  statutory framework within which the Australian Taxation Office can combat the illicit trade in tobacco which threatens to erode the excise revenue base. The main features of the amendments are:

·       a comprehensive licensing scheme for the production of, and dealing in, tobacco and for the manufacturing and storage of excisable goods generally, including petroleum products and alcohol;

·       controls, through permission requirements and offences for contravening those requirements, over the movement and possession of tobacco seeds, plant and leaf;

·       increased penalties, including terms of imprisonment, for unlawful movement or possession of excisable goods on which duty has not been paid;

·       an infringement notice penalty for selling or possessing excisable goods on which duty has not been paid; and

·       extended powers for officers to stop and search conveyances for tobacco leaf or excisable goods.

Date of effect :  The measures will commence from the date of Royal Assent.

Proposal announced :  Not previously announced.

Financial impact :  The measures form part of a strategy to combat the illicit trade in tobacco. The extent of the erosion of excise revenue attributable to the illicit trade is difficult to estimate.

Compliance cost impact :  Compliance costs will increase marginally for producers of, and dealers in, tobacco leaf who will be required to apply identification labels to bales of tobacco leaf that are moved from their premises.

Summary of regulation impact statement

Regulation impact on business

Impact :  As the measures in this Bill are directed against illegal and non-compliant activity the regulatory impact of the amendments is minimal. The 2 elements of the proposals that could have some impact are changes to the licensing arrangements and the requirement for an approved form of labels to be attached to bales of tobacco leaf.

Main points

·       The revised licensing scheme requires more information to be provided by applicants and licence holders than under existing arrangements, but is designed to discourage persons with a high risk of non-compliance and will not result in additional costs to persons who are likely to comply with the law.

·       The proposal to require tobacco bale labels to be attached to tobacco bales when moved from the premises of a producer or dealer will impose some additional costs, but these are not expected to be significant and will assist in identifying the unauthorised movement of tobacco.

·       Participants in the tobacco industry, and representatives of entities engaged in the manufacture and storage of excisable goods, have been consulted on the proposals and have indicated support for them.

 



C hapter 1  

Overview

Outline of Chapter

1.1         This Chapter provides an overview of the amendments to the Excise Act 1901 (Excise Act) to be made by this Bill. A detailed explanation of the amendments is contained in the following Chapters.

Summary of the amendments

Purpose of the amendments

1.2         The amendments will address deficiencies in existing provisions of the Excise Act that regulate the production, dealing, manufacturing and storage of tobacco. The amendments will create a more robust statutory framework to support the compliance initiatives of the Australian Taxation Office (ATO). They are designed to protect the excise revenue base from the illicit trade in tobacco, and from arrangements prone to duty evasion and deferral in relation to excisable goods generally.

Date of effect

1.3         The amendments will apply from the date of Royal Assent [Clause 2] . As there will be licences and permissions in force at that time, transitional provisions will ensure the continuity of those licences and permissions under the proposed new arrangements.

Background to the amendments

1.4         The Excise Act contains rules dealing with liability to excise duty. Excise duty is a tax levied on certain products when entered by the owner or manufacturer for consumption in Australia. Excise duty is currently collected on petroleum, crude oil, tobacco and alcohol.

1.5         The Excise Act regulates activity relating to these products prior to the time at which excise duty is paid. The Excise Act contains long-standing provisions which regulate the production of, and dealing in, tobacco leaf. The Excise Act also contains rules governing manufacturing and storage which apply both to tobacco and to other excisable goods. The Excise Act and associated statutes (the ‘Excise Acts’, as defined in section 4 of the Excise Act) are currently administered by the Commissioner of Taxation under delegation from the Chief Executive Officer of Customs.

1.6         These amendments are designed to support a strategy of improving compliance with the excise law and protecting the excise revenue base, with a particular focus directed against illicit tobacco.

Comparison of key features of new law and current law

New law

Current law

Growing tobacco will be regulated. Only a licensed producer will be permitted to produce tobacco seed, plants and leaf.

Existing controls are limited to the regulation of tobacco leaf after it has been stripped from the plant.

Permission will be needed to move tobacco leaf. An identification label will need to be attached to bales of tobacco leaf prior to their movement from a producer’s premises unless there is an express permission for movement without a label.

The movement of tobacco leaf is not regulated.

Conveyances will be able to be stopped and searched for excisable goods or tobacco leaf at any place .

Only conveyances which are about to leave a factory or other ‘Excise place’ may be stopped and searched, and only for excisable goods.

A 2-tier structuring of some offence provisions which provide for increased maximum penalties, including a 2 year maximum term of imprisonment, where the requisite mental element is established.

Current penalties for some offences have no deterrent effect because they are small relative to the potential proceeds from illegal activity.

Introduction of pecuniary penalties for the offence of unauthorised movement of tobacco leaf and the counterfeiting of tobacco bale labels.

There are no controls on the movement of tobacco leaf.

Introduction of a fixed 20 penalty units infringement notice penalty for selling or possessing tobacco on which duty has not been paid.

No infringement notice scheme.

Increase the maximum penalty to 500 penalty units for existing offences dealing with the movement of excisable goods without authority or permission.

Current maximum penalty - usually $5,000.

Comprehensive scheme for the granting, suspension and cancellation of licences for:

·       producing or dealing in tobacco seeds, plant or leaf; and

·       manufacturing and storing excisable goods. 

There is no basis for refusing an application for registration as a producer or dealer or for the declaration of an approved place as a place for storing excisable goods. There is very limited scope for suspending or cancelling a manufacturing licence.

The new penalty provisions

Increased penalties

1.7         This Bill will increase the maximum penalties for a number of offences against the Excise Act. In addition to increasing the level of fines, in some instances by a factor of 10, provision is also made for a term of imprisonment to be imposed. In sentencing an offender, a court will have the discretion of imposing a fine, a prison sentence or, where appropriate, a combination of both. [Schedule 1, item 57, new section 127A]

Tiered structure of offences

1.8         The revised offence provisions will introduce a tiered penalty structure. The higher level of penalty will apply where the requisite fault elements are established. A lower level of penalty will apply if only the physical elements of the offence are established, that is, where the offence is one of strict liability. This is consistent with the classification of offences in the Criminal Code.

Multiple of the duty that would be payable if goods had been entered for home consumption

1.9         In addition to specifying a fixed maximum fine, some of the penalty provisions include the alternative of a multiple of the duty that would be payable if the goods that are the subject of the offence had been entered for home consumption. The maximum multiple stated is 5.

1.10       This alternative permits the court to calculate a fine by reference to the potential loss to revenue associated with the offence, and to impose a penalty of an exemplary nature as a means of deterring offenders.

1.11       In calculating the amount of the penalty, the duty is to be determined at the rate that applied on the day on which the offence occurred, if that day is known. Otherwise, it is to be determined at the rate that applied on the day on which prosecution for the offence was instituted. [Schedule 1, item 12, definition of ‘penalty day’ in subsection 4(1)]

Infringement notice scheme

1.12        New Part XA will be inserted in the Excise Act to provide a scheme for imposing and discharging penalties for relatively minor offences without the time, expense and distress of court proceedings.

1.13       This Bill proposes that a person who sells or possesses excisable goods on which excise duty has not been paid may be subject to a penalty imposed by an infringement notice instead of being prosecuted for the offence [Schedule 1, item 59, new subsection 129A(1)] . A person remains liable to prosecution if they do not pay the penalty in accordance with the notice [Schedule 1, item 59, new subsection 129A(2)] .

1.14       An infringement notice is expected to be issued in circumstances where there is a high degree of certainty that the physical element of the offence exists and the risk of frequency of the offence is high, but the seriousness of the offence or degree of culpability of the offender is relatively low.

Issuing an infringement notice

1.15       The infringement notice scheme provides for written notice to be given to a person of their liability to an infringement notice penalty. A notice must be issued within 12 months of the offence being committed [Schedule 1, item 59, new section 129B] . Under new section 129C the notice must contain the following information:

·       the day on which the notice is issued;

·       brief details of the alleged offence, including the day and place at which the offence happened;

·       the name of the person to whom the notice is issued;

·       the amount of the penalty, which is set at 20 penalty units;

·       how the penalty can be paid; and

·       the fact that, unless the notice is withdrawn, payment of the penalty within due date or such further time as is allowed will excuse the person from liability to prosecution for the offence.

1.16       Payment of the infringement notice penalty is due by the date specified in the notice, which must be at least 28 days after the issue date. [Schedule 1, item 59, new section 129D]

1.17       Except where the notice is withdrawn, payment of the penalty will excuse the person from liability to prosecution for the offence. [Schedule 1, item 59, new section 129E]

1.18       An infringement notice may be withdrawn if, in all the circumstances, it is considered appropriate to do so [Schedule 1, item 59, new section 129F] . It may be appropriate to withdraw the notice if it is considered that the offence is of sufficient seriousness to warrant prosecution and the consequent higher penalty.

Special rules relating to partnerships

1.19       The amendments made by this Bill recognise that licences issued under new Part IV may be held by a partnership. As a partnership does not have separate legal personality it is necessary for provisions that are phrased in terms of the actions of a person, to have effect as if the partnership were a person or as if the acts of a partner were the acts of the partnership.

1.20       The general rule that partners are jointly and severally liable for partnership liabilities is to be applied. Offences that would be stated as being committed by a partnership are to be taken to have been committed by each partner who is a party to, or knowingly concerned in, the relevant act or omission. [Schedule 1, item 21, new section 6A]

Gender neutrality

1.21       To achieve gender neutrality in drafting, provisions in the Excise Act that refer to ‘he’, ‘him’, ‘his’ or ‘himself’ are to have ‘or she’, ‘or her’ or ‘or herself’ added. [Schedule 1, items 68 to 71]

 



C hapter 2  

Licensing for excise purposes

Outline of Chapter

2.1         This Chapter explains the changes to be made by this Bill to the regulation of certain activities relating to goods before the liability to excise duty is discharged. This includes activities relating to tobacco in the various forms it takes before it is manufactured into an excisable form.

Summary of the amendments

2.2         The amendments will replace the current rules about the registration of tobacco producers and dealers, the licensing of manufacturers of all excisable goods and the declaration of approved places with a comprehensive set of rules covering the licensing of persons to conduct these activities.

2.3         Existing Parts III and IV of the Excise Act 1901 (Excise Act) will be replaced by new Parts III, IV and IVA . [Schedule 1, items 26 and 27]

Comparison of key features of new law and current law

New law

Current law

Licensing of producers of tobacco seed, plant and leaf only if qualifying criteria are satisfied.

Registration of producers of tobacco leaf, without qualification.

Licensing of dealers in tobacco seed, plant and leaf only if qualifying criteria are satisfied.

Registration of dealers in tobacco leaf, without qualification.

Licensing of manufacturers of excisable goods only if qualifying criteria are satisfied and subject to any limitation specified.

Licensing of manufacturers is subject to any limitation being specified.

Licensing of persons to store and carry out specified activities in relation to excisable goods only if qualifying criteria are satisfied.

Declaration, on application and without qualification, of an approved place relating to excisable goods.

Ability to suspend or cancel licences if certain conditions are not satisfied.

Revocation of licence only in limited circumstances.

Detailed explanation of the amendments

2.4         Currently, the concept of a licence applies in the Excise context only in relation to the manufacturer of excisable goods. This Bill will extend that concept to other areas of activity that are regulated for the purposes of the Excise Act.

2.5         The term licence as it is used in the Excise Act will be defined in subsection 4(1) to cover:

·       a producer licence;

·       a dealer licence;

·       a manufacturer licence; and

·       a storage licence.

 

[Schedule 1, item 6, definition of ‘licence’ in subsection 4(1)]  

2.6         Licences, other than manufacturer licences, will have effect from the day they are granted and remain in force until they are cancelled. [Schedule 1, item 26, new subsection 39E(1)]

2.7         A manufacturer licence, will have effect from the day it is granted and remains in force until the following 31 December unless it is cancelled before then. [Schedule 1, item 26, new subsection 39E(2)]

2.8         A manufacturer licence can be renewed, on application by the licence holder, for the following year, unless there are grounds for cancelling the licence. [Schedule 1, item 26, new section 39F]

Manufacturing excisable goods

Licence to manufacture

2.9         A manufacturer of excisable goods (alcohol, tobacco and petroleum products) will continue to be required to be licensed.

2.10       A manufacturer licence is to be defined as a licence that authorises the holder to manufacture excisable goods [Schedule 1, item 11, definition of ‘manufacturer licence’ in subsection 4(1)] . The holder of such a licence will be referred to as a ‘licensed manufacturer’ in various sections of the Excise Act [Schedule 1, item 8, definition of ‘licensed manufacturer’ in subsection 4(1)] .

2.11       Increased penalties will apply for the manufacture of tobacco or other excisable goods without a licence. Section 35 of the Excise Act currently provides for a maximum penalty of $5,000. Proposed new section 25 provides for a tiered offence with substantially higher maximum penalties. If a person manufactures excisable goods without a licence and either:

·       knows the goods are excisable or is reckless as to whether they are excisable:

-           2 years imprisonment; and/or

-           the greater of 500 penalty units or 5 times the duty that would be payable if the goods had been entered for home consumption; or

·       irrespective of the person’s state of mind - 100 penalty units.

[Schedule 1, item 26, new section 25]

Manufacturing in accordance with the Excise Act and the licence

2.12       A licensed manufacturer will continue to be required to manufacture their excisable goods in accordance with the Excise Act (which includes any relevant requirements or obligations in the Excise Regulations 1925 (Excise Regulations)) and in accordance with their licence (which may contain conditions). New section 26 replaces the corresponding limb of section 35 and provides for increased penalties for breaching this requirement in the same manner as provided for in new section 25 for manufacturing without a licence. [Schedule 1, item 26, new section 26]

Manufacturing only at licensed premises

2.13       A licensed manufacturer will only be permitted to manufacture excisable goods at premises specified in their licence. This requirement is the same as, and substitutes, that in section 45 of the Excise Act.

2.14       If a licensed manufacturer intentionally manufactures excisable goods at premises either knowing, or reckless as to whether, the goods are excisable, and either knowing, or reckless as to whether the premises are specified in their licence, they will be liable to a maximum pecuniary penalty of 500 penalty units, a maximum term of imprisonment of 2 years, or both. [Schedule 1, item 26, new subsection 27(1)]

2.15       A licensed manufacturer who manufactures excisable goods at premises not specified in their licence, will be liable to a maximum pecuniary penalty of 100 penalty units irrespective of their state of mind. Strict liability applies for this offence. [Schedule 1, item 26, new subsections 27(2) and (3)]

Producing tobacco seed, plant and leaf

Licence to produce

2.16       A person who wants to grow tobacco will be required to hold a ‘producer licence’. A producer licence is to be defined as a licence that authorises the holder to produce tobacco seed, plant and leaf [Schedule 1, item 15, definition of ‘producer licence’ in subsection 4(1)] . The holder of such a licence will be referred to as a ‘licensed producer’ in various sections of the Excise Act [Schedule 1, item 9, definition of ‘licensed producer’ in subsection 4(1)] .

2.17       If a person intentionally grows tobacco, knowing that it is tobacco or is reckless as to whether it is tobacco, and does not hold a producer licence they will be liable to a maximum pecuniary penalty of 500 penalty units, a maximum term of imprisonment of 2 years, or both. [Schedule 1, item 26, new subsection 28(1)]

2.18       A person who grows tobacco without a producer licence will be liable to a maximum pecuniary penalty of 100 penalty units irrespective of their state of mind. Strict liability applies for this offence. [Schedule 1, item 26, new subsections 28(2) and (3)]

Production must be in accordance with the Excise Act and the licence

2.19       A licensed producer will be required to grow tobacco in accordance with the Excise Act and in accordance with their licence, which may contain conditions. New section 29 provides for a maximum penalty of 2 years imprisonment, 500 penalty units or both if the producer either knows or is reckless as to whether their production contravenes the Excise Act or their licence [Schedule 1, item 26, new subsection 29(1)] . A maximum penalty of 100 penalty units applies if the production of tobacco seed, plants or leaf contravenes the Excise Act or their licence, irrespective of their state of mind [Schedule 1, item 26, new subsections 29(2) and (3)] .

Production and storage only at licensed premises

2.20       A licensed producer will only be permitted to grow tobacco and to store tobacco seeds, plant and leaf at premises specified in their licence. Permission may be given, on application, to store tobacco seeds, plant or leaf at premises other than that specified in their licence. These requirements are the same as, and substitute, those in sections 29 and 30 of the Excise Act.

2.21       If a producer, without permission, intentionally stores tobacco seeds, plant or leaf, either knowing, or reckless as to whether, the material is tobacco, and either knowing, or reckless as to whether, the premises are specified in their licence, they will be liable to a maximum pecuniary penalty of 500 penalty units, a maximum term of imprisonment of 2 years or both. [Schedule 1, item 26, new subsection 30(1)]

2.22       A producer who stores tobacco seeds, plant or leaf at another site without permission will be liable to a maximum pecuniary penalty of 100 penalty units irrespective of their state of mind. Strict liability applies for this offence. [Schedule 1, item 26, new subsections 30(2) and (3)]

2.23       If a producer intentionally grows tobacco, either knowing, or reckless as to whether, it is tobacco, and either knowing, or reckless as to whether the premises are specified in their licence, they will be liable to a maximum pecuniary penalty of 500 penalty units, a maximum term of imprisonment of 2 years or both. [Schedule 1, item 26, new subsection 31(1)]

2.24       A producer who grows tobacco at another site will be liable to a maximum pecuniary penalty of 100 penalty units irrespective of their state of mind. Strict liability applies for this offence. [Schedule 1, item 26, new subsections 31(2) and (3)]

Record-keeping

2.25       A producer will be required to keep accounts and lodge returns in accordance with the Excise Regulations. This requirement is the same as, and substitutes, that in section 33 of the Excise Act. Division 1 of Part II of the Excise Regulations specifies the records a producer must keep.

2.26       Failure to comply with the requirement to keep records and lodge returns as prescribed is an offence which carries a maximum penalty of 30 penalty units. [Schedule 1, item 26, new section 32]

Access to licensed premises

2.27       Officers are to have access to the licensed premises of a licensed producer in order to monitor compliance with the Excise Act, including licence conditions and permissions. [Schedule 1, item 41, new subsection 86(3)]

Dealing in tobacco seed, plant and leaf

Licence to deal

2.28       A person who wants to buy and sell tobacco in the form of seed, plant or leaf will be required to hold a ‘dealer licence’. A dealer licence is to be defined as a licence that authorises the holder to deal in tobacco seed, plant and leaf [Schedule 1, item 4, definition of ‘dealer licence’ in subsection 4(1)] . The holder of such a licence will be referred to as a ‘licensed dealer’ in various sections of the Excise Act [Schedule 1, item 7, definition of ‘licensed dealer’ in subsection 4(1)] .

2.29       If a person intentionally deals in tobacco seed, plant and leaf, either knowing, or reckless as to whether, it is tobacco seed, plant or leaf, and does not hold a dealer licence they will be liable to a maximum pecuniary penalty of 500 penalty units, a maximum term of imprisonment of 2 years, or both. [Schedule 1, item 26, new subsection 33(1)]

2.30       A person who deals in tobacco without a dealer licence will be liable to a maximum pecuniary penalty of 100 penalty units irrespective of their state of mind. Strict liability applies for this offence. [Schedule 1, item 26, new subsections 33(2) and (3)]

2.31       A licensed producer who transfers or acquires tobacco seed, plant or leaf in the course of their production will not be required to hold a dealer licence. [Schedule 1, item 26, new subsection 33(4)]

Dealing must be in accordance with the Excise Act and the licence

2.32       A licensed dealer will be prohibited from dealing in tobacco seed, plant or leaf except in accordance with the Excise Act and in accordance with their licence, which may contain conditions. New section 34 provides for a maximum penalty of 2 years imprisonment, a 500 penalty units fine, or both, if the dealer either knows or is reckless as to whether they are dealing in contravention of the Excise Act or their licence [Schedule 1, item 26, new subsection 34(1)] . A maximum penalty of 100 penalty units applies if their dealing in tobacco seed, plants or leaf contravenes the Excise Act or their licence, irrespective of their state of mind [Schedule 1, item 26, new subsections 34(2) and (3)] .

Dealing and storage only at licensed premises

2.33       A licensed dealer will only be permitted to deal in and store tobacco seeds, plant or leaf at premises specified in their licence. Permission may be given, on application, to store tobacco seeds, plant or leaf at premises other than premises specified in their licence. These requirements are the same as, and substitute, those in sections 29 and 30 of the Excise Act.

2.34       If a dealer, without permission, intentionally stores tobacco seeds, plant or leaf, either knowing, or reckless as to whether, the material is tobacco seeds, plant or leaf, and either knowing, or reckless as to whether, the premises are specified in their licence they will be liable to a maximum pecuniary penalty of 500 penalty units, a maximum term of imprisonment of 2 years or both. [Schedule 1, item 26, new subsection 35(1)]

2.35       A dealer who stores tobacco seeds, plant or leaf at another site without permission will be liable to a maximum pecuniary penalty of 100 penalty units irrespective of their state of mind. Strict liability applies for this offence. [Schedule 1, item 26, new subsections 35(2) and (3)]

2.36       If a dealer intentionally carries on business as a dealer at another site either knowing, or reckless as to whether, the premises are specified in their licence they will be liable to a maximum pecuniary penalty of 500 penalty units, a maximum term of imprisonment of 2 years or both. [Schedule 1, item 26, new subsection 35(1)]

2.37       A dealer who carries on business as a dealer at another site will be liable to a maximum pecuniary penalty of 100 penalty units irrespective of their state of mind. Strict liability applies for this offence. [Schedule 1, item 26, new subsections 35(2) and (3)]

Record-keeping

2.38       A dealer will be required to keep accounts and lodge returns in accordance with the Excise Regulations [Schedule 1, item 26, new subsection 37(1)] . This requirement is the same as, and substitutes, that in section 33 of the Excise Act. Division 1 of Part II of the Excise Regulations specifies the records a producer must keep.

2.39       Failure to comply with the requirement to keep records and lodge returns as prescribed is an offence which carries a maximum penalty of 30 penalty units. [Schedule 1, item 26, new section 37]

Access to licensed premises

2.40       Officers are to have access to licensed premises of a licensed dealer in order to monitor compliance with the Excise Act, including licence conditions and permissions. [Schedule 1, item 41, new subsection 86(3)]

Applying for a licence

2.41       Applications for licences are to be forwarded to the Australian Taxation Office (ATO). An application for a licence may be required to be made in a form approved by the Commissioner of Taxation, under delegation from the Chief Executive Officer (CEO) of Customs, and must set out the following information:

·       the applicant’s name and address;

·       the name and address of certain other persons who, if they fail to satisfy fit and proper criteria, may constitute grounds for a licence to be refused;

·       a description of the premises in relation to which the licence is sought;

·       particulars of the matters that are listed as relevant to the exercise of the discretion to grant or refuse a licence; and

·       any other information that may be prescribed.

[Schedule 1, item 27, new section 39]

Any fee prescribed in the regulations must accompany an application for a manufacturer’s licence [Schedule 1, item 27, new paragraph 39(2)(f)] .

Discretion to grant or refuse a licence

2.42       The decision to grant, or refuse to grant, a licence is discretionary. Matters that may affect the exercise of the discretion to refuse to grant a licence include:

·       the applicant is not a fit and proper person;

·       an employee of the applicant, who performs managerial function, is not a fit and proper person;

·       if the applicant is a company - a director, officer or a shareholder who participates in the management or control of the company, is not a fit and proper person;

·       an associate (as defined for income tax purposes) of the applicant is not a fit and proper person;

·       the ability of the applicant to keep the requisite accounts and records; and

·       any necessity for revenue protection reasons, to refuse to grant the licence.

If a producer licence or dealer licence has been applied for, the licence can be refused only if it is considered necessary that the licence be refused in order to protect the revenue. [Schedule 1, item 27, new section 39A]

2.43       For a manufacturer licence, additional matters affecting the exercise of the discretion include:

·       the adequacy of the physical security of the premises having regard to the nature of the premises, the kind and quantity of goods to be kept there, and the security measures to be employed [Schedule 1, item 27, new paragraph 39A(2)(g)] ; and

·       the suitability of plant and equipment to be used having regard to the nature of the premises and the goods relating to the licence sought [Schedule 1, item 27, new paragraph 39A(2)(i)] .

2.44       For a producer licence or dealer licence, an additional matter affecting the exercise of the discretion is the physical security of the premises having regard to the nature of the premises, the quantity of tobacco leaf to be kept there, and the security measures to be employed. [Schedule 1, item 27, new paragraph 39A(2)(h)]

2.45       For a storage licence, additional matters affecting the exercise of the discretion include:

·       the adequacy of the physical security of the premises having regard to the nature of the premises, the kind and quantity of goods to be kept there, and the security measures to be employed [Schedule 1, item 27, new paragraph 39A(2)(g)] ; and

·       whether a grant of the licence is likely to delay the time at which liability for duty arises [Schedule 1, item 27, new paragraph 39A(2)(k)] .

What a fit and proper person is

2.46       In forming an opinion about whether an individual is a fit and proper person, the following matters may be taken into account:

·       whether the person has been charged, during the preceding year, with an offence against a provision of the ‘Excise Acts’, or another law where the offence is punishable by imprisonment for one year or longer, or a fine of 50 penalty units or more;

·       whether the person has been convicted of such an offence during the 10 years preceding the application;

·       whether the person has held a licence under the Excise Act which has been cancelled, or has participated in the management or control of a company that has had such a licence cancelled;

·       whether the person is an undischarged bankrupt; and

·       whether a false or misleading statement had been made in the application.

[Schedule 1, item 27, new section 39B]

What a fit and proper company is

2.47       Similar considerations apply in forming an opinion about whether a company is fit and proper . The following matters may be taken into account:

·       whether the company has been charged, during the preceding year, with an offence against a provision of the ‘Excise Acts’, or another law where the offence is punishable by a fine of 50 penalty units or more;

·       whether the company has been convicted of such an offence during the 10 years preceding the application;

·       whether the company has held a licence under the Excise Act which has been cancelled; and

·       whether a receiver has been appointed or whether the company is under administration, a deed of arrangement is current, it has been placed under official management or is being wound up.

[Schedule 1, item 27, new section 39C]

Licence conditions

2.48       There will be a general condition of a licence that obliges the licence holder to notify the ATO, within 30 days, of any material changes since the application was made which relate to the matters that are relevant to the exercise of the discretion to grant the licence. Licence holders will also be obliged to notify their ceasing to conduct the activity for which the licence has been granted. [Schedule 1, item 27, new subsection 39D(1)]

2.49       Other licence conditions may be prescribed in the law, or by the licence itself if they are considered necessary or desirable for revenue protection reasons, or for the purpose of ensuring compliance with the ‘Excise Acts’. [Schedule 1, item 27, new subsections 39D(2) and (3)]

2.50       The conditions may be varied on application by the licence holder. [Schedule 1, item 27, new subsection 39D(4)]

2.51       The conditions that apply to a manufacturer licence may be varied on renewal. [Schedule 1, item 27, new subsection 39F(2)]

Suspension and cancellation of licences

2.52       In broad terms, a licence may either be suspended or cancelled if an opinion is formed, on reasonable grounds, that certain circumstances exist. A licence may be suspended in circumstances where the holder ought reasonably be provided with the opportunity to provide reasons why their licence should not be cancelled. A licence may be cancelled without being suspended.

Circumstances in which a licence may be suspended

2.53       A licence may be suspended if the officer making the decision has reasonable grounds to believe that:

·       a conclusion should be formed on a matter relevant to the exercise of the discretion to grant the licence that is different from the conclusion formed at the time the licence was granted;

·       a condition of the licence has been breached;

·       the licence holder has made a statement to the ATO that is false or misleading;

·       it is otherwise necessary for revenue protection reasons; or

·       in the case of a manufacturer licence or storage licence - for the purpose of ensuring compliance with the ‘Excise Acts’.

If the licence held is a producer licence or dealer licence, it can be suspended only if it is considered necessary that the licence be suspended in order to protect the revenue.

[Schedule 1, item 27, new section 39G]

2.54          A conclusion formed on a matter relevant to the exercise of the discretion to grant the licence that is different from the conclusion formed at the time the licence was granted may relate to whether a person or company is no longer fit and proper . In forming a view about whether a person or company is no longer fit and proper the considerations that applied at the time the licence was granted will apply to the period since the licence was granted [Schedule 1, item 27, new sections 39H and 39I] . For instance, if a person has been convicted of an offence against a provision of the Excise Act, or if a company has had a receiver or administrator appointed, after the licence was granted, they may no longer be considered fit and proper .

How a licence is suspended

2.55       The licence holder must be notified in writing if a decision has been made to suspend their licence [Schedule 1, item 27, new subsection 39J(1)] . Notice may be served personally or by post [Schedule 1, item 27, new subsection 39J(2)] .

2.56       The notice must inform the licence holder that they must, within 7 days of notice being served, provide the ATO with reasons why their licence should not be cancelled. [Schedule 1, item 27, new paragraph 39J(3)(a)]

2.57       If it is considered necessary for a licence to be suspended for revenue protection reasons, or for the purpose of ensuring compliance with the ‘Excise Acts’, the notice will state that the licence is suspended [Schedule 1, item 27, new paragraph 39J(3)(b)] . In that event, suspension takes effect from the time the suspension notice is served [Schedule 1, item 27, new subsection 39J(4)] .

2.58       Suspension can be revoked at any time, and must be revoked if the licence is not cancelled within 28 days from the time suspension took effect. [Schedule 1, item 27, new subsection 39J(5)]

2.59       If a notice does not state that the licence is suspended, it continues in force without restriction, but is liable to being cancelled if a submission against cancellation is not made.

The consequences of licence suspension

2.60       Suspension will prohibit a licence holder from conducting activities that are the subject of the licence. This prohibition is subject to any permissions or directions being given to the licence holder. These permissions or directions may relate to:

·       keeping and storing goods at licensed premises;

·       carrying out processes at licensed premises; or

·       the movement of goods.

[Schedule 1, item 27, new subsection 39K(6)]

2.61       The ATO may also take control of the licensed premises and the goods contained there, if considered necessary for protecting the revenue or ensuring compliance with the ‘Excise Acts’. [Schedule 1, item 27, new paragraph 39K(6)(e)]

2.62       The licence holder may be required to pay the costs incurred by the ATO as a result of the suspension [Schedule 1, item 27, new paragraph 39K(6)(f)] . Such a fee may be recovered by court proceedings as a debt due to the Commonwealth [Schedule 1, item 27, new subsection 39K(7)] .

2.63       A tiered penalty will apply to an offence against the suspension prohibition. The following maximum penalties apply if the holder of a suspended manufacturer licence or storage licence contravenes the prohibition and either knows the relevant goods are excisable or is reckless as to whether they are excisable:

·       2 years imprisonment; and/or

·       the greater of 500 penalty units or 5 times the duty that would be payable if the goods had been entered for home consumption.

[Schedule 1, item 27, new subsection 39K(1)]

2.64       The following maximum penalties apply if the holder of a suspended producer licence or dealer licence contravenes the prohibition by, respectively producing or dealing in material:

·       and either knows the relevant material is tobacco seed or plant or is reckless as to whether it is such material:

-           2 years imprisonment; and/or

-           500 penalty units; or

·       and either knows the relevant material is tobacco leaf or is reckless as to whether it is such material:

-           2 years imprisonment; and/or

-           the greater of 500 penalty units or 5 times the duty, calculated according to the method prescribed in the regulations, that would be payable if the tobacco leaf had been manufactured into excisable goods and then entered for home consumption.

[Schedule 1, item 27, new subsection 39K(2)]

2.65       Similarly, if the holder of a suspended producer licence, dealer licence or manufacturer licence contravenes the prohibition by keeping or storing tobacco leaf:

·       and either knows, or is reckless as to whether it is, tobacco leaf:

-           2 years imprisonment; and/or

-           the greater of 500 penalty units or 5 times the duty, calculated according to the method prescribed in the regulations, that would be payable if the tobacco leaf had been manufactured into excisable goods and then entered for home consumption.

[Schedule 1, item 27, new subsection 39K(3)]

2.66       If a licence holder contravenes the suspension prohibition, irrespective of the person’s state of mind, or the nature of the material, the maximum penalty is 100 penalty units. Strict liability applies to this offence. [Schedule 1, item 27, new subsections 39K(4) and (5)]

Circumstances in which a licence may be cancelled

2.67       A licence may be cancelled on the same grounds as those the officer may have regard to in suspending a licence. [Schedule 1, item 27, new subsection 39L(1)]

2.68       A licence must be cancelled if the holder requests, in writing, that their licence be cancelled, or if the officer making the decision to cancel the licence is satisfied that the licence holder no longer has in their possession, custody or control any excisable goods or tobacco seed, plant or leaf. [Schedule 1, item 27, new subsection 39L(2)]

How a licence is cancelled

2.69       The licence holder must be notified in writing of a decision to cancel their licence. Notice may be served personally or by post. [Schedule 1, item 27, new subsection 39L(3)]

2.70       The owner of goods stored at premises to which the cancellation applies, if they are not the licence holder, must also be notified in writing to either pay any duty payable on the goods or remove the goods in accordance with a permission. The owner in these circumstances must also be warned that the goods will be sold if they fail to comply with the notified requirements within the time specified. Notice may be served personally or by post. [Schedule 1, item 27, new subsections 39L(4) and (5)]

2.71       If the owner of goods fails to comply with the notice within the specified time or such further time allowed, the ATO will be authorised to sell the goods. [Schedule 1, item 27, new subsection 39L(6)]  

2.72       If a person whose licence is cancelled is requested to surrender their licence, they will be liable for a penalty of one penalty unit if they fail to do so. [Schedule 1, item 27, new subsections 39L(7) and (8)]

Removal of goods after a licence has been cancelled

2.73       There will be a prohibition on moving excisable goods on which duty has not been paid, and on tobacco seed, plants and leaf, from premises after the licence to which the premises relates has been cancelled. This prohibition will be subject to any permission being granted to authorise movement of the goods or material.

2.74       A tiered penalty will apply to an offence against the prohibition. The maximum penalties apply if the person contravenes the prohibition and:

·       either knows, or is reckless as to whether, the relevant goods are excisable goods on which duty has not been paid:

-           2 years imprisonment; and/or

-           the greater of 500 penalty units or 5 times the duty that would be payable if the goods had been entered for home consumption;

·       either knows the relevant material is tobacco seed or plant or is reckless as to whether it is such material:

-           2 years imprisonment; and/or

-           500 penalty units;

·       either knows the relevant material is tobacco leaf or is reckless as to whether it is such material:

-           2 years imprisonment; and/or

-           the greater of 500 penalty units or 5 times the duty, calculated according to the method prescribed in the Excise Regulations, that would be payable if the tobacco leaf had been manufactured into excisable goods and then entered for home consumption; and

·       irrespective of the person’s state of mind - 100 penalty units.

[Schedule 1, item 27, new section 39M]  

This provision will replace section 120A which currently prohibits the removal, without authority, of goods on cancellation of a manufacturer licence [Schedule 1, item 56] .

Removal of goods by the ATO on licence cancellation

2.75       Section 162A of the Excise Act provides for removal of excisable goods on which duty has not been paid from the premises of a manufacturer whose licence is cancelled. This section will be replaced by new section 39N in Part IV which contains the provisions relating to licences. References to section 162A will be replaced by references to section 39N. [Schedule 1, items 63 to 65]

2.76       Any excisable goods held on premises specified on a licence which has expired without renewal, or been cancelled, may be removed to another place the ATO selects. [Schedule 1, item 27, new subsection 39N(1)]

2.77       If the owner does not claim the goods within 6 months from the removal date and pays the duty and expenses of removal and storage, the ATO will be authorised to sell or otherwise dispose of the goods. [Schedule 1, item 27, new subsection 39N(2)]

2.78       Duty payable on the goods is to be calculated according to the rate in force at the time of payment. [Schedule 1, item 27, new subsection 39N(3)]

2.79       This amendment will not affect the special provisions in Part VIIA of the Excise Act dealing with the cancellation of a brewery licence. [Schedule 1, item 27, new subsection 39N(4)]

Specific provisions relating to licences

Temporary transfer of licence when licence holder dies

2.80       The legal personal representative of a licence holder who dies will be regarded as the licence holder for a maximum period of 3 months from the date of death. The legal personal representative or another person must apply for a licence if the activity is to be continued at the same premises after that time. [Schedule 1, item 27, new section 39O]

Services of notices

2.81       Section 29 of the Acts Interpretation Act 1901 contains an interpretative rule about service by post of properly addressed, prepaid posted documents. A document addressed to the premises specified in a licence is to be taken to satisfy the properly addressed requirement. [Schedule 1, item 27, new section 39P]

Review of licensing decisions

2.82       Section 162C of the Excise Act provides for the review of certain decisions on application to the Administrative Appeals Tribunal (AAT). These include decisions to grant and to cancel a manufacturer licence and decisions in relation to approved places. These decisions are to be excluded from the list of decisions to be reviewed by this process. [Schedule 1, item 66]  

2.83       Decisions to refuse to grant a licence, or to suspend or cancel a licence, will instead be subject to review in accordance with the provisions of the Taxation Administration Act 1953 relating to the review of taxation decisions. [Schedule 1, item 27, new section 39Q]

2.84       This entitles applicants or licence holders who lodge an objection within 60 days of notice of the decision being served on them to seek review of that decision. Further rights of review by the AAT or appeal to a court are provided for if the applicant or licence holder is dissatisfied with the review decision.

Spent Convictions Scheme

2.85       The obligation to notify of a person’s convictions for offences does not affect the operation of Part VIIC of the Crimes Act 1914 which includes provisions that relieve persons of the requirement to disclose spent convictions in certain circumstances. [Schedule 1, item 27, new section 39R]

Licence fees

2.86       Section 14 of the Excise Act, which provides for the imposition of fees on licences, will be repealed [Schedule 1, item 22] . Currently, only manufacturers of excisable goods are liable for licence fees. Excise Regulation 246 prescribes a fee of $10. The requirement for a licence fee to be paid on application for a manufacturer licence will be preserved in new paragraph 39(2)(f) .

Application and transitional provisions

2.87       The new licensing scheme is to apply from the date of Royal Assent to this Bill, although persons registered or licensed under the Excise Act at that time will not be required to apply for licences under the new scheme in order to continue the activities they are currently authorised to conduct. They will, however, be subject to the new rules relating to the conditions of licences and to the suspension and cancellation of licences.

2.88       Regulations may be made for matters of a transitional, saving or application nature arising from the amendments to be made by this Bill. Such regulations may require a person who is regarded as the holder of a licence under the new scheme because they were licensed, registered or the proprietor of an approved place at the date of Royal Assent to provide information that is relevant to the granting, suspension or cancellation of a licence under the new scheme [Clause 4] . Such information is to be regarded as provided in relation to an application for a licence under the new scheme [Schedule 2, item 10] .

Persons who are currently registered to produce or deal in tobacco leaf

2.89       Producers and dealers who are registered under the existing provisions of the Excise Act immediately before the new licensing scheme comes into effect will be regarded as holding a producer licence or dealer licence as appropriate [Schedule 2, subitems 4(1) and 5(1)] . Premises in respect of which they are registered will be regarded as premises specified on their licence for the purposes of the Excise Act as amended by this Bill [Schedule 2, subitems 4(2) and 5(2)] .

Premises that are currently declared to be approved places

2.90       A proprietor of an approved place under section 5A of the Excise Act will be regarded as holding a storage licence from the time the new scheme comes into effect, and the place will be regarded as premises specified in such a licence for the purposes of the Excise Act as amended by this Bill. [Schedule 2, item 2]

Manufacturers and applicants for manufacturer licences

2.91       Manufacturers who are licensed under the existing provisions of the Excise Act immediately before the new licensing scheme comes into effect will be regarded as holding a manufacturer licence under the new scheme [Schedule 2, subitem 9(2)] . Premises in respect of which they are licensed will be regarded as premises specified on a manufacturer licence for the purposes of the Excise Act as amended by this Bill [Schedule 2, subitem 9(3)] .

2.92       A person who has applied for a manufacturer licence but whose application had not been determined before the new licensing scheme comes into effect will be regarded as applying for a manufacturer licence under the new scheme. [Schedule 2, subitem 9(1)]

Licence fees and securities

2.93       Regulation 246 which prescribes the amount of a licence fee will continue to apply under the new licensing scheme as if it had been made under new paragraph 39(2)(f) rather than section 14, which is to be repealed. [Schedule 2, item 3]

2.94       Regulation 12 which prescribes the amount of security in relation to a licence to manufacture tobacco will continue to apply under the new licensing scheme as if it had been made under section 16 of the Excise Act rather than section 39, which is to be repealed. [Schedule 2, item 8]

Permissions for the storage of tobacco leaf

2.95       Section 29 of the Excise Act, which will be repealed by this Bill, provides for permissions to be granted for the storage of tobacco leaf. Permissions under that section that are in force before the commencement of this Act will be regarded as permissions granted under new sections 30 and 35 the corresponding replacement provisions proposed by this Bill. [Schedule 2, item 6]

Accounts and returns required by the regulations

2.96       Registered producers and dealers are required, by section 33 of the Excise Act, to keep accounts and furnish returns as required by the Excise Regulations. As section 33 will be repealed by this Bill, the regulations made under section 33 will be taken to have been made under new sections 32 and 37 the corresponding replacement provisions proposed by this Bill. [Schedule 2, item 7]

Consequential amendments

Approved places

2.97       The introduction of storage licences has consequences for existing references in the Excise Act to an ‘approved place’. Section 5A, which provides for the declaration of an approved places in relation to goods, will be repealed. [Schedule 1, item 20]

2.98       A new definition of approved place in subsection 4(1) will replace the existing one. It will be defined as ‘premises specified in a storage licence’. [Schedule 1, item 1]  

2.99       Premises that are specified in a storage licence may also be a ‘warehouse’ for the purposes of the Customs Act 1901 if a licence has also been granted under that Act for that purpose.

2.100     The concept of a proprietor of an approved place will also be redefined in subsection 4(1) as ‘a person or partnership who holds a storage licence that specifies that place in the licence’. [Schedule 1, items 16 and 18]

References to licensed manufacturer

2.101     Currently, only manufacturers of excisable goods are licensed under the Excise Act. References to licensed persons necessarily means persons who are manufacturers. As this Bill provides for other activities to be licensed, existing references to licensed persons will be changed to references to licensed manufacturers [Schedule 1, items 5, 24, 28, 29, 33, 34, 36, 40, 48 and 51]  and references to unlicensed persons will be changed to ensure they relate to persons who manufacture excisable goods without a licence [Schedule 1, items 22 and 23] .

Definitions of producer, dealer, manufacturer and proprietor

2.102     Existing definitions of ‘producer’, ‘dealer’, ‘manufacturer’ and ‘proprietor’ will be repealed as a consequence of the introduction of new definitions based on the holding of licences under the scheme proposed by this Bill. [Schedule 1, items 3, 4, 7 to 11 and 14 to 18]

Different sized licences

2.103     Section 23 of the Excise Act refers to lesser and larger licences. This concept is redundant and the section will be repealed. [Schedule 1, item 25]

Schedules to the Excise Act

2.104     The following Schedules to the Excise Act will be redundant under the new licensing scheme and will be repealed [Schedule 1, item 67] :

·       Schedule II - Request for registration as producer;

·       Schedule III - Certificate of registration of producer;

·       Schedule IV - Request for registration as a dealer;

·       Schedule V - Certificate of registration as a dealer;

·       Schedule VI - Application for licence to manufacture; and

·       Schedule VII - Manufacturer’s licence.

 



C hapter 3  

Control of tobacco seed, plant and leaf

Outline of Chapter

3.1         This Chapter explains the amendments to the Excise Act 1901 (Excise Act), other than the licensing provisions, that are designed to counter the illicit trade in tobacco.

Summary of the amendments

3.2         A factor contributing to the growth in the illicit trade in tobacco is the ease by which tobacco leaf can be transported to unlicensed manufacturers. Currently, there are no laws regulating the movement of tobacco leaf.

3.3         Amendments to be made by this Bill will prohibit the movement of tobacco leaf without permission. An identification label will need to be attached to bales of tobacco leaf prior to their movement from a producer’s premises or dealer’s premises unless there is an express permission for movement without a label.

3.4         Other amendments will replace current provisions that make it an offence to buy tobacco leaf from a person other than a producer, dealer or manufacturer or to sell it to a person other than a dealer or manufacturer with comprehensive provisions prohibiting the buying, selling and possession of tobacco seed, plant and leaf.

Detailed explanation of the amendments

Unlawfully possessing tobacco seed, plant or leaf

3.5          New section 117C will prohibit a person who does not have a producer licence, dealer licence, manufacturer licence, or other permission under the Excise Act, from possessing or having the custody or control of tobacco seed, plants or leaf. A tiered penalty structure applies to this offence as follows:

·       if a person, without authority, possesses tobacco seed or plants either knowing, or reckless as to whether, the material is tobacco seed or plants:

-           2 years imprisonment; and/or

-           500 penalty units;

·       if a person, without authority, possesses tobacco leaf either knowing, or reckless as to whether, the material is tobacco leaf:

-           2 years imprisonment; and/or

-           the greater of 500 penalty units or 5 times the duty that would be payable if the leaf had been manufactured into tobacco and had then been entered for home consumption; or

·       if a person, without authority, possesses tobacco seed, plants or leaf irrespective of their state of mind - 100 penalty units.

[Schedule 1, item 52, new section 117C]

Permission to move tobacco leaf

3.6         The authorised movement of tobacco leaf is to occur by written permission specifying both the place from, and the place to, the leaf is to be moved. [Schedule 1, item 27, new subsection 44(1)]

3.7         It is proposed that a ‘tobacco bale label’ will be affixed to tobacco leaf while it is not located at the licensed premises of a producer, dealer or manufacturer. An express written permission will be required for tobacco leaf to be moved without a ‘tobacco bale label’ [Schedule 1, item 27, new subsection 44(2)] . A tobacco bale label is to be defined as a label that is in an approved form and which uniquely identifies a bale of tobacco leaf [Schedule 1, item 19, definition of ‘tobacco bale label’ in subsection 4(1)] .

3.8         Movement permissions may be made conditional on requirements specified in the permission being complied with [Schedule 1, item 27, new subsection 44(3)] . Failure to comply with these requirements will be an offence. A tiered penalty applies as follows:

·       if the person intentionally or recklessly fails to comply with a permission requirement:

-           2 years imprisonment; and/or

-           the greater of 500 penalty units or 5 times the duty, calculated according to the method prescribed in the regulations, that would be payable if the tobacco leaf had been manufactured into excisable goods and then entered for home consumption; or

·       if the person fails to comply with a requirement, irrespective of their state of mind - 100 penalty units.

[Schedule 1, item 27, new subsections 44(4) to (6)]

Moving tobacco leaf without permission

3.9          New section 117D will prohibit a person from moving tobacco leaf without permission. A tiered penalty structure applies to this offence as follows:

·       if a person, without permission, intentionally moves tobacco leaf either knowing, or reckless as to whether, the material is tobacco leaf:

-           2 years imprisonment; and/or

-           the greater of 500 penalty units or 5 times the duty that would be payable if the leaf had been manufactured into tobacco and had then been entered for home consumption; or

·       if a person, without permission, moves tobacco leaf, irrespective of their state of mind - 100 penalty units.

[Schedule 1, item 52, new section 117D]

Counterfeit tobacco bale labels

3.10       To support the authenticity of tobacco bale labels as a system of authorising the movement of tobacco leaf it will be an offence to make counterfeit tobacco bale labels. The maximum penalty for making counterfeit labels will be 500 penalty units. [Schedule 1, item 52, new subsection 117I(1)]

3.11       It will also be an offence to use a counterfeit tobacco bale label. A tiered penalty structure will apply to the offence as follows:

·       if a person uses a tobacco bale label either knowing, or reckless as to whether, the label is counterfeit - 500 penalty units; or

·       if a person uses a counterfeit tobacco bale label, irrespective of their state of mind - 100 penalty units.

[Schedule 1, item 52, new subsections 117I(2) to (4)]

 

Unlawfully buying tobacco seed or plant

3.12        New section 117E will prohibit a person from buying tobacco seed or plant from a person who is not a licensed producer or dealer. A tiered penalty structure applies to this offence as follows:

·       if a person buys tobacco seed or plant either knowing, or reckless as to whether, the seller is not a licensed producer or dealer:

-           2 years imprisonment; and/or

-           500 penalty units; or

·       if a person buys tobacco seed or plant from a person who is not a licensed producer or dealer, irrespective of their state of mind - 100 penalty units.

[Schedule 1, item 52, new section 117E]

Unlawfully buying tobacco leaf

3.13       Paragraph 120(1)(ii) of the Excise Act makes it an offence to buy tobacco leaf from a person who is not a registered producer or dealer or a licensed manufacturer. The current penalty is a fine not exceeding $1,000. As this does not constitute an effective deterrent to activity that undermines the taxation base for excise on tobacco, this Bill will replace the existing provisions with a specific offence provision containing stricter penalties. [Schedule 1, items 54 and 55]

3.14       New section 117F will prohibit a person from buying tobacco leaf from a person who is not a licensed producer, dealer or manufacturer. A tiered penalty structure applies to this offence as follows:

·       if a person buys tobacco leaf either knowing, or reckless as to whether, the seller is not a licensed producer, dealer or manufacturer:

-           2 years imprisonment; and/or

-           the greater of 500 penalty units or 5 times the duty that would be payable if the leaf had been manufactured into tobacco and had then been entered for home consumption; or

·       if a person buys tobacco leaf from a person who is not a licensed producer, dealer or manufacturer, irrespective of their state of mind - 100 penalty units.

[Schedule 1, item 52, new section 117E]

Unlawfully selling tobacco seed or plant

3.15       New section 117G will prohibit a person from selling tobacco seed or plant to a person who is not a licensed producer, dealer or manufacturer. A tiered penalty structure applies to this offence as follows:

·       if a person sells tobacco seed or plant either knowing, or reckless as to whether, the buyer is not a licensed producer, dealer or manufacturer:

-           2 years imprisonment; and/or

-           500 penalty units; or

·       if a person sells tobacco seed or plant to a person who is not a licensed producer, dealer or manufacturer, irrespective of their state of mind - 100 penalty units.

[Schedule 1, item 52, new section 117G]

Unlawfully selling tobacco leaf

3.16       Paragraph 120(1)(iii) of the Excise Act makes it an offence to sell tobacco leaf to a person who is not a registered dealer or a licensed manufacturer. The current penalty is a fine not exceeding $1,000. As this does not constitute an effective deterrent to activity that undermines the taxation base for excise on tobacco, this Bill will replace the existing provisions with a specific offence provision containing stricter penalties. [Schedule 1, items 54 and 55]

3.17       New section 117H will prohibit a person from selling tobacco leaf to a person who is not a licensed dealer or manufacturer. A tiered penalty structure applies to this offence as follows:

·       if a person sells tobacco leaf either knowing, or reckless as to whether, the buyer is not a licensed dealer or manufacturer:

-           2 years imprisonment; and/or

-           the greater of 500 penalty units or 5 times the duty that would be payable if the leaf had been manufactured into tobacco and had then been entered for home consumption; or

·       if a person sells tobacco leaf to a person who is not a licensed dealer or manufacturer, irrespective of their state of

mind - 100 penalty units.

[Schedule 1, item 52, new section 117H]

Forfeiture of tobacco seed, plant and leaf

3.18       Section 116 of the Excise Act currently provides for the forfeiture of tobacco leaf that is found on premises where tobacco is manufactured illegally.

3.19       The circumstances in which material will be forfeited will be extended to situations where:

·       tobacco leaf is moved without permission [Schedule 1, item 50, new paragraph 116(1)(ba)] ;

·       tobacco seed, plant or leaf is found in the possession, custody or control of a person who does not have the requisite licence or other permission under the Excise Act [Schedule 1, item 50, new paragraph 116(1)(bb)] ; or

·       tobacco seed, plant or leaf is stored at premises that have not been specified in a relevant licence under this Act [Schedule 1, item 50, new paragraph 116(1)(bc)] .

In each of these situations, offences proposed by this Bill would be committed.

L i ability of a producer or dealer for stock deficiency

3.20       Section 105 of the Excise Act authorises an officer to check the tobacco leaf stock of a producer or dealer. If a deficiency is found, the producer or dealer is liable to pay duty on the basis that the deficient amount had been manufactured into excisable goods.

3.21       This section will be amended to clarify that the liability to duty is on the basis that the deficient amount taken to have been manufactured into excisable goods had also been entered into home consumption on the day the deficiency was found. [Schedule 1, item 47]

Consequential amendments

Replacement of the ‘proclaimed material’ concept

3.22       Provisions of the Excise Act dealing with tobacco leaf currently use the term ‘proclaimed material’. Proclaimed material is defined in subsection 4(1) as ‘tobacco leaf, or material that is for the time being declared by Proclamation to be proclaimed material for the purposes of this Act’.

3.23       The amendments which extend control over tobacco seed, plant and leaf have made the ‘proclaimed material’ concept redundant. Consequently, the definition of ‘proclaimed material’ is to be repealed. [Schedule 1, item 13]

3.24       References to ‘proclaimed material’ in other sections will be replaced with references to tobacco leaf or to tobacco seed, tobacco plant and tobacco leaf, as appropriate. [Schedule 1, items 35, 46 and 49]

 



C hapter 4  

Other measures to improve compliance

Outline of Chapter

4.1         This Chapter explains the other amendments that are designed to improve compliance with the provisions of the Excise Act 1901 ( Excise Act).

Summary of the amendments

4.2         In addition to the introduction of a comprehensive licensing scheme and measures specific to the control of tobacco, this Bill will make amendments to:

·       restructure offences and increase penalties for:

-           breach of manufacturers’ record-keeping requirements;

-           unlawfully possessing excisable goods on which duty has not been paid;

-           unlawfully moving excisable goods on which duty has not been paid;

-           unlawfully selling excisable goods on which duty has not been paid;

-           unauthorised movement of goods that are subject to Customs control;

-           failure to comply with the requirements of a permission to move goods that are subject to Customs control; and

-           failure to comply with the requirements of a permission to deliver goods for home consumption without an ‘entry for home consumption’ having been made;

·       extend the power of officers to stop and search conveyances in certain circumstances; and

·       increase the penalty limits that may be sought in proceedings instituted in some courts.

Detailed explanation of amendments

Increased penalties for certain offences

Records kept by manufacturers

4.3         Section 50 of the Excise Act imposes an obligation on manufacturers to keep and retain records as directed, and to produce those records on demand. The current penalty for breaching this obligation is $2,000.

4.4         The maximum penalty will be increased to 30 penalty units, which is consistent with the penalty for similar offences under other Commonwealth Acts. [Schedule 1, item 30]

4.5         A note will be inserted that refers to the section in the Crimes Act 1914 that defines the amount of a penalty unit, currently $110. [Schedule 1, item 31]

4.6         A further amendment will remove any doubt that the offence is one of strict liability. [Schedule 1, item 32, new subsection 50(1A)]

Unlawfully possessing excisable goods on which duty has not been paid

4.7         Section 117 of the Excise Act currently prohibits a person who does not have a licence to manufacture or other permission under the Excise Act from having in their possession, custody or control excisable goods on which excise duty has not been paid. A person who contravenes this prohibition is, on conviction, subject to a maximum pecuniary penalty, under section 129, of either $50,000 or between 2 and 5 times the duty that would be payable if the goods had been entered for home consumption.

4.8         Existing sections 117 and 129 will be repealed and new section 117 will prohibit the possession, custody or control of excisable goods on which excise duty has not been paid. [Schedule 1, items 52 and 58]

4.9         The replacement provision will incorporate a tiered penalty structure including a maximum term of imprisonment of 2 years where the requisite mental elements of the offence are established. [Schedule 1, item 52, new subsection 117(1)]

4.10       A maximum penalty of 100 penalty units will apply to the offence of unlawful possession of the goods on a strict liability basis. [Schedule 1, item 52, new subsections 117(2) and (3)]

4.11       An infringement notice penalty of 20 penalty units may instead apply to the unlawful possession of excisable goods on which excise duty has not been paid if court proceedings to prosecute the offence are not instituted. [Schedule 1, item 59, new section 129B]

Unlawfully moving excisable goods on which duty has not been paid

4.12       Section 119 of the Excise Act currently prohibits a person, without permission, from conveying excisable goods on which excise duty has not been paid. A person who contravenes this prohibition is, on conviction, subject to a maximum pecuniary penalty, under section 129, of either $50,000 or between 2 and 5 times the duty that would be payable if the goods had been entered for home consumption.

4.13       Existing sections 119 and 129 will be repealed and new section 117A will prohibit the moving, without permission, of excisable goods on which excise duty has not been paid. [Schedule 1, items 53 and 58]

4.14       The replacement section will incorporate a tiered penalty structure including a maximum term of imprisonment of 2 years where the requisite mental elements of the offence are established. [Schedule 1, item 52, new subsection 117A(1)]

4.15       A maximum penalty of 100 penalty units will apply to the offence of moving excisable goods without permission on a strict liability basis. [Schedule 1, item 52, new subsections 117A(2) and (3)]

Unlawfully selling excisable goods on which duty has not been paid

4.16        New section 117B will prohibit the selling of excisable goods on which duty has not been paid with a tiered penalty structure as follows:

·       if a person sells excisable goods either knowing, or reckless as to whether, they are excisable goods on which duty has not been paid:

-           2 years imprisonment; and/or

-           the greater of 500 penalty units or 5 times the duty that would be payable if the goods had been entered for home consumption; or

·       if a person sells excisable goods on which duty has not been paid irrespective of their state of mind - 100 penalty units.

[Schedule 1, item 52, new subsections 117B(1) to (3)]

4.17       An infringement notice penalty of 20 penalty units may instead apply to the unlawful selling of excisable goods on which excise duty has not been paid if court proceedings to prosecute the offence are not instituted. [Schedule 1, item 59, new section 129B]

Under bond sales

4.18       The offence under new section 117B does not apply to the sale of excisable goods on which excise duty has not been paid if, at the time of the sale, the goods are stored at an approved place and are later stored at that place or another approved place until they are entered for home consumption or delivered for exportation. [Schedule 1, item 52, new subsection 117B(4)]

Unauthorised movement, etc. of goods subject to Customs control

4.19       Excisable goods are subject to Customs control until they are delivered either for home consumption (since a liability to excise duty would have arisen) or for exportation to a place outside Australia (which exempts from liability to excise duty). Under existing section 61, movement of excisable goods whilst within Customs control is prohibited unless authorised by the Excise Act.

4.20       The current penalty for moving, altering or interfering with excisable goods within Customs control is $20,000.

4.21       Section 61 is to be replaced with a new section 61 which differs in that it provides for a tiered penalty structure as follows:

·       if a person moves, alters or interferes with excisable goods that are subject to Customs control either knowing, or reckless as to whether, the goods are excisable goods subject to Customs control:

-           2 years imprisonment; and/or

-           the greater of 500 penalty units or 5 times the duty that would be payable if the goods had been entered for home consumption; or

·       if a person moves, alters or interferes with excisable goods that are subject to Customs control, irrespective of the person’s state of mind - 100 penalty units.

[Schedule 1, item 37, new section 61]

Permission to move goods subject to Customs control

4.22       Section 61A of the Excise Act provides for the giving of permissions to move goods that are subject to Customs control. Permissions are given in writing and may be subject to the condition that requirements specified in the permission be complied with. Permission requirements are those considered necessary for revenue protection reasons or for the purpose of ensuring compliance with the ‘Excise Acts’.

4.23       Subsection 61A(4) provides for a maximum penalty of $20,000 and forfeiture of goods if the permission requirements are not complied with. It will be replaced with new subsections 61A(4) to (7) which provide a tiered penalty structure as follows:

·       if a person intentionally or recklessly fails to comply with a permission requirement:

-           2 years imprisonment; and/or

-           the greater of 500 penalty units or 5 times the duty that would be payable if the goods had been entered for home consumption; or

·       if a person fails to comply with a permission requirement irrespective of their state of mind - 100 penalty units.

[Schedule 1, item 38, new subsections 61A(4), (6) and (7)]

4.24       Intentionally or recklessly failing to comply with a permission requirement will, as at present, result in forfeiture of the goods. [Schedule 1, item 38, new subsection 61A(5)]

Permission to deliver goods for home consumption without an ‘entry for home consumption’ having been made

4.25       Section 61C of the Excise Act provides for the giving of permissions to deliver goods for home consumption without an entry for home consumption having been made. Permissions are given in writing and may be subject to the condition that requirements specified in the permission be complied with. Permission requirements are those considered necessary for revenue protection reasons or for the purpose of ensuring compliance with the ‘Excise Acts’.

4.26       Subsection 61C(4) provides for a maximum penalty of $20,000 and forfeiture of goods if the permission requirements are not complied with. It will be replaced with new subsections 61C(4) to (4C) which provides a tiered penalty structure as follows:

·       if a person intentionally or recklessly fails to comply with a permission requirement:

-           2 years imprisonment; and/or

-           the greater of 500 penalty units or 5 times the duty that would be payable if the goods had been entered for home consumption; or

·       if a person fails to comply with a permission requirement, irrespective of the person’s state of mind - 100 penalty units.

[Schedule 1, item 39, new subsections 61C(4), (4B) and (4C)]

4.27       Intentionally or recklessly failing to comply with a permission requirement will, as at present, result in forfeiture of the goods. [Schedule 1, item 39, new subsection 61C(4A)]

Power of officers to stop and search conveyances

4.28       Under section 87 of the Excise Act, officers have a limited power to stop and search conveyances that are about to leave a manufacturer’s premises or other ‘Excise place’ in order to check that the movement of excisable goods is authorised.

4.29       This power will be extended to allow officers to stop and search conveyances that are about to leave the licensed premises of a licensed producer or licensed dealer. [Schedule 1, items 42 and 44]

4.30       Additionally, an officer will be authorised to stop and search conveyances at any place, without warrant, if they have reasonable grounds to believe that the conveyance holds tobacco leaf or excisable goods and is being used, or intended to be used, in the commission of an offence. [Schedule 1, item 45, new section 87AA]

4.31       The term conveyance is currently defined in section 87 to mean an aircraft, railway rolling stock, vehicle or vessel of any kind. As the term will also be used in new section 87AA , its definition is to be relocated to subsection 4(1) which contains the definitions of terms used generally in the Excise Act. [Schedule 1, items 2 and 43]

Institution of prosecution proceedings

4.32       Section 134 of the Excise Act provides for the maximum penalty amount for an offence to be limited by the maximum penalty amount that may be sought in proceedings in certain courts.

4.33       The limit on the maximum penalty for an offence that may be sought in proceedings in a County Court or District Court of a State, or a Local Court of full jurisdiction of South Australia or of the Northern Territory, is to be increased from $20,000 to $40,000. [Schedule 1, item 60]

4.34       The limit on the maximum penalty for an offence that may be sought in proceedings in a court of summary jurisdiction is to be increased from $5,000 to $20,000. [Schedule 1, item 61]

Application provision

4.35               The changes to the limits on the maximum penalty that may be sought in a particular court apply to proceedings instituted after the amendment comes into effect. [Schedule 1, item 62]

 



C hapter 5  

Regulation impact statement

Policy objective

5.1         The objective of the measures proposed by this Bill is to provide a statutory framework to support administrative action directed against the illicit tobacco trade and against arrangements that constitute a high risk that duty on excisable goods will be evaded.

5.2         Although the measures focus primarily on illegal activity, the following elements of the proposed amendments have a regulatory impact:

·       a revised scheme for licences to be held by persons who undertake activity regulated by the Excise Act 1901 (Excise Act); and

·        proposals to regulate the movement of tobacco leaf.

Each of these elements are addressed in turn.

Licensing for excise purposes

Implementation options

5.3         Currently, the Excise Act only provides for the licensing of manufacturers of excisable goods. A registration requirement applies to producers and dealers of tobacco, and premises are declared to be an approved place in relation to excisable goods on application by the proprietor. There are limited grounds on which a licence can be revoked or on which an application can be refused. This provides opportunities for persons to exploit existing authorities conferred by the Excise Act to engage in illicit activity or to evade excise duty.

5.4         To remedy these deficiencies, the licensing scheme is to be reinforced with specific criteria against which a decision to refuse to grant, or to cancel, a licence can be made. The licensing scheme is also to apply consistently to all activities that are regulated for excise purposes - the production of, and dealing in, tobacco and the manufacturing and storage of all excisable goods.

5.5         An alternative option may have been to preserve existing distinctions and to specify different criteria for licensing decisions relating to each type of licence. This option would have complicated the law, and was rejected for consistency reasons.

Assessment of impacts

5.6         The revised licensing scheme will require certain information relating to the licence holder and their associates to be given to the Australian Taxation Office (ATO) at the time a licence is applied for and, if a change to that information occurs after the application is made, within a 30 day period from the time of that change.

5.7         Although the revised requirements will apply to new applicants from the time the scheme commences, persons who are licensed, registered or have approved place declarations in force at the time the new scheme commences may be required to provide similar information. This Bill provides for regulations to be made that will specify the information to be provided by persons who are taken to be licensed under the transitional arrangements.

5.8         Information to be provided in accordance with the requirements of the revised scheme is used to assess the risk of non-compliant behaviour by the applicant or licence holder and would be relevant to the exercise of the discretion to refuse to grant a licence (in the case of an applicant) or to either suspend or cancel a licence (in the case of a licence holder).

Impact group identification

5.9         The revised licensing scheme will apply to producers and dealers in tobacco seeds, plant and leaf. There are, however, very few producers and dealers entering the tobacco industry.

5.10       The scheme will also apply to manufacturers of all excisable goods and to proprietors of approved places in relation to excisable goods. There are some 300 licensed manufacturers covering all excisable goods (tobacco, alcohol and petroleum products). There are 165 establishments that are approved places for excise purposes and many of these are associated with licensed manufacturers.

Analysis of costs / benefits

5.11       It is not expected that there will be costs of any significance involved in providing licensing information. However, the fact that this information is considered in deciding whether to grant a licence will deter persons who, if licensed, would constitute a risk to revenue.

Other issues - consultation

5.12       There has been consultation on the proposal with tobacco growers’ cooperatives and tobacco importers and with industry associations representing licensed excise manufacturers and entities holding goods on which excise duty has not been acquitted, such as duty-free stores. They have supported proposals for stricter licensing arrangements.

Conclusion

5.13       The revised licensing scheme is designed to exclude persons who present a high risk of non-compliance with the excise laws from engaging in activity that is regulated for excise purposes.

5.14       The scheme is unlikely to impose additional costs of any significance on persons taken to be licensed under the transitional arrangements or on new applicants who are compliant or likely to be compliant with excise legislation.

Permission for the movement of tobacco leaf

Implementation options

5.15       Currently there are no restrictions on the movement of tobacco leaf. This provides wide scope for the product to enter the illicit tobacco market.

5.16       It is proposed that the movement of tobacco leaf be subject to express permission being given by the ATO. The requirement for a movement permission will apply from the time it is imported or leaves the premises of a licensed producer or dealer, until it is delivered to a manufacturer’s factory. Currently, permission given for the movement of excisable goods on which duty has not been paid is documented in writing.

5.17       Although it is proposed that written permission also be a means of authorising the movement of tobacco leaf, it is also proposed that an approved form of label be attached to tobacco bales to authorise their movement. Tobacco bale labels will uniquely identify each bale and will provide a means of easily identifying unauthorised movement of tobacco leaf.

Assessment of impacts

5.18       After being stripped from the plant and cured, tobacco leaf is ordinarily packed in bales and transported for sale. The bales are ultimately purchased by manufacturers and unpacked by them for processing into consumable tobacco products.

5.19       The current lack of regulation over the movement of tobacco leaf has allowed tobacco leaf to be easily diverted to the illicit market. Controls over the movement of tobacco will assist enforcement agencies to identify and seize the illicit product.

Impact group identification

5.20       Producers who are licensed to grow tobacco will be required to obtain permission to move tobacco leaf from their premises. Permission in writing may be given for particular deliveries or, on a continuing basis, for delivery during a specified period to a particular location where, for example, the bales are sold.

5.21       Other persons, such as licensed dealers or manufacturers will also be required to obtain permission to move tobacco leaf. It is expected that the majority of these permissions will be issued on a continuing basis.

Analysis of costs / benefits

5.22       Tobacco bales currently have labels attached or are otherwise marked to identify them for marketing purposes. It is anticipated that the proposed labels will add value to the marketing practices currently employed by the growers’ cooperatives, by enabling them to trace the movement of bales from grower to manufacturer.

5.23       As the proposed labelling system is in an early stage of development, the costs of using the labels cannot be reliably estimated but is not expected to be significant. The attaching of the proposed label to tobacco bales will add a relatively minor task to the production of tobacco.

Other issues - consultation

5.24       There has been extensive consultation with tobacco growers’ cooperatives and the tobacco manufacturers on measures to counter the illicit market. They have indicated support for proposals to regulate the movement of tobacco leaf.

Conclusion

5.25       The requirement for bales of tobacco leaf to have a tobacco bale label attached while not located at premises specified in the licence of a producer, dealer or manufacturer is expected to result in some, but not significant, additional costs.

5.26       The tobacco bale labels are expected to assist in detecting the illicit product and thereby help protect the legitimate tobacco industry.



I ndex        

Schedule 1:  Amendment of the Excise Act 1901

Bill reference

Paragraph no.

Item 1

2.98

Item 2

4.31

Items 3 and 4

2.102

Item 4, definition of ‘dealer licence’ in subsection 4(1)

2.28

Item 5

2.101

Item 6, definition of ‘licence’ in subsection 4(1)

2.5

Item 7, definition of ‘licensed dealer’ in subsection 4(1)

2.28

Items 7 to 11

2.102

Item 8, definition of ‘licensed manufacturer’ in subsection 4(1)

2.10

Item 9, definition of ‘licensed producer’ in subsection 4(1)

2.16

Item 11, definition of ‘manufacturer licence’ in subsection 4(1)

2.10

Item 12, definition of ‘penalty day’ in subsection 4(1)

1.11

Item 13

3.23

Items 14 to 18

2.102

Item 15, definition of ‘producer licence’ in subsection 4(1)

2.16

Items 16 and 18

2.100

Item 19, definition of ‘tobacco bale label’ in subsection 4(1)

3.7

Item 20

2.97

Item 21, new section 6A

1.20

Item 22

2.86, 2.101

Item 23

2.101

Item 24

2.101

Item 25

2.103

Item 26

2.3

Item 26, new section 25

2.11

Item 26, new section 26

2.12

Item 26, new subsection 27(1)

2.14

Item 26, new subsections 27(2) and (3)

2.15

Item 26, new subsection 28(1)

2.17

Item 26, new subsections 28(2) and (3)

2.18

Item 26, new subsections 29(1) to (3)

2.19

Item 26, new subsection 30(1)

2.21

Item 26, new subsections 30(2) and (3)

2.22

Item 26, new subsection 31(1)

2.23

Item 26, new subsections 31(2) and (3)

2.24

Item 26, new section 32

2.26

Item 26, new subsection 33(1)

2.29

Item 26, new subsections 33(2) and (3)

2.30

Item 26, new subsection 33(4)

2.31

Item 26, new subsections 34(1) to (3)

2.32

Item 26, new subsection 35(1)

2.34, 2.36

Item 26, new subsections 35(2) and (3)

2.35, 2.37

Item 26, new section 37

2.39

Item 26, new subsection 37(1)

2.38

Item 26, new subsection 39E(1)

2.6

Item 26, new subsection 39E(2)

2.7

Item 26, new section 39F

2.8

Item 27

2.3

Item 27, new section 39

2.41

Item 27, new paragraph 39(2)(f)

2.41

Item 27, new section 39A

2.42

Item 27, new paragraph 39A(2)(g)

2.43, 2.45

Item 27, new paragraph 39A(2)(h)

2.44

Item 27, new paragraph 39A(2)(i)

2.43

Item 27, new paragraph 39A(2)(k)

2.45

Item 27, new section 39B

2.46

Item 27, new section 39C

2.47

Item 27, new subsection 39D(1)

2.48

Item 27, new subsections 39D(2) and (3)

2.49

Item 27, new subsection 39D(4)

2.50

Item 27, new subsection 39F(2)

2.51

Item 27, new section 39G

2.53

Item 27, new sections 39H and 39I

2.54

Item 27, new subsections 39J(1) and (2)

2.55

Item 27, new paragraph 39J(3)(a)

2.56

Item 27, new paragraph 39J(3)(b)

2.57

Item 27, new subsection 39J(4)

2.57

Item 27, new subsection 39J(5)

2.58

Item 27, new subsection 39K(1)

2.63

Item 27, new subsection 39K(2)

2.64

Item 27, new subsection 39K(3)

2.65

Item 27, new subsections 39K(4) and (5)

2.66

Item 27, new subsection 39K(6)

2.60

Item 27, new paragraph 39K(6)(e)

2.61

Item 27, new paragraph 39K(6)(f)

2.62

Item 27, new subsection 39K(7)

2.62

Item 27, new subsection 39L(1)

2.67

Item 27, new subsection 39L(2)

2.68

Item 27, new subsection 39L(3)

2.69

Item 27, new subsections 39L(4) and (5)

2.70

Item 27, new subsection 39L(6)

2.71

Item 27, new subsections 39L(7) and (8)

2.72

Item 27, new section 39M

2.74

Item 27, new subsection 39N(1)

2.76

Item 27, new subsection 39N(2)

2.77

Item 27, new subsection 39N(3)

2.78

Item 27, new subsection 39N(4)

2.79

Item 27, new section 39O

2.80

Item 27, new section 39P

2.81

Item 27, new section 39Q

2.83

Item 27, new section 39R

2.85

Item 27, new subsection 44(1)

3.6

Item 27, new subsection 44(2)

3.7

Item 27, new subsections 44(3) to (6)

3.8

Items 28 and 29

2.101

Item 30

4.4

Item 31

4.5

Item 32, new subsection 50(1A)

4.6

Items 33, 34 and 36

2.101

Item 35

3.24

Item 37, new section 61

4.21

Item 38, new sections 61A(4), (6) and (7)

4.23

Item 38, new subsection 61A(5)

4.24

Item 39, new subsections 61C(4), (4B) and (4C)

4.26

Item 39, new subsection 61C(4A)

4.27

Item 40

2.101

Item 41, new subsection 86(3)

2.27, 2.40

Items 42 and 44

4.29

Item 43

4.31

Item 45, new section 87AA

4.30

Items 46 and 49

3.24

Item 47

3.21

Items 48 and 51

2.101

Item 50, new paragraph 116(1)(ba);

3.19

Item 50, new paragraph 116(1)(bb)

3.19

Item 50, new paragraph 116(1)(bc)

3.19

Item 52

4.8

Item 52, new subsection 117(1)

4.9

Item 52, new subsections 117(2) and (3)

4.10

Item 52, new subsection 117A(1)

4.14

Item 52, new subsections 117A(2) and (3)

4.15

Item 52, new subsections 117B(1) to (3)

4.16

Item 52, new subsection 117B(4)

4.18

Item 52, new section 117C

3.5

Item 52, new section 117D

3.9

Item 52, new section 117E

3.12, 3.14

Item 52, new section 117G

3.15

Item 52, new subsection 117G(1)

3.15

Item 52, new section 117H

3.17

Item 52, new subsection 117I(1)

3.10

Item 52, new subsections 117I(2) to (4)

3.11

Item 53

4.13

Items 54 and 55

3.13, 3.16

Item 56

2.74

Item 57, new section 127A

1.7

Item 58

4.8, 4.13

Item 59, new subsection 129A(1)

1.13

Item 59, new subsection 129A(2)

1.13

Item 59, new section 129B

1.15, 4.11, 4.17

Item 59, new section 129D

1.16

Item 59, new section 129E

1.17

Item 59, new section 129F

1.18

Item 60

4.33

Item 61

4.34

Item 62

4.35

Items 63 to 65

2.75

Item 66

2.82

Item 67

2.104

Items 68 to 71

1.21

Schedule 2:  Transitional provisions



Bill reference

Paragraph no.

Item 2

2.90

Item 3

2.93

Item 6

2.95

Item 7

2.96

Item 8

2.94

Item 10

2.88

Subitems 4(1) and 5(1)

2.89

Subitems 4(2) and 5(2)

2.89

Subitem 9(1)

2.92

Subitems 9(2) and (3)

2.91