We have all had a long standing interest in the outcome of Deloitte’s efforts to generate relief from the Road User charge for heavy vehicles travelling on private toll ways.

Unfortunately, the three Federal Court Judges hearing the latest round of that matter have favoured the view that the words ‘public road’, as they appear throughout the Fuel Tax Act 2006, should be given a broad meaning, being one that includes roads generally accessible by the public. 

This means that no refunds are available to taxpayers with heavy vehicles travelling on privately operated toll roads.  Further, those entities should continue to apply the Road User Charge to the fuel consumed while travelling on those tollroads. 

For the avoidance of doubt, this also means that no fuel tax credits are available for light vehicles travelling for business purposes on a privately operated toll road. 

Many of you are familiar with the argument put forward to the court, ie that a toll road managed by a private operator shouldn’t be considered a ‘public road’, and that the purpose of the Road User Charge was to finance the maintenance of ‘public roads’, not privately maintained toll roads.  From there it is easy to understand why it could be seen as inequitable to collect the Road User Charge where it is not been used for the purpose it was apparently intended, ie the maintenance of the road being travelled on.

We appreciate this view but, ultimately, the Full Federal Court has taken the line that the language of the tax statute does not apply in the way that we, and you, thought it should.  

However, the recent court decision did have some good news as well, in that the Full Federal Court rejected the ATO’s argument that an absolute limit of four years applies to refund entitlements.  By way of example, where a taxpayer had lodged an Objection against a decision by the ATO to deny a fuel tax refund claim and that Objection took an extended time to resolve, the ATO applied the view that the four year period was retrospective to the date the Objection was finalised, rather than the date it was lodged. 

The ATO’s interpretation had seen them deny a number of fuel tax credit amendment claims, in relation to matters other than the toll road point.  Based on the Full Federal Court decision, the ATO should now be obliged to re-consider those claims and process refunds previously denied. 

Of course, this article is of a general nature only and if you have questions about your own position, you should contact Deloitte (Chris Sant on 0404 382 854) or your own tax adviser.