What is Excise Duty?

What is Excise Duty?

An Excise duty is an indirect, commodity-based tax that is imposed on certain goods that damage consumer health or pollute the environment. Unlike other taxes, the excise tax applies at the moment of manufacture, instead of at sale. The Australian Taxation Office (ATO) levies this tax on certain types of goods produced or manufactured in Australia. These goods include; Alcohol, Cigarettes, Fuel, and Petroleum products. As a result, these excise duties raise the price consumers to pay to discourage future consumption or waste of such products. 

Table of Contents

How does it affect my business?

It is a requirement that Businesses producing, manufacturing or storing these goods in Australia must have an excise license. The ATO issues these licenses. In addition, once you have your license, your business must lodge excise returns and pay excise duty. You should check the ATO website to make sure you correctly lodge your returns. If your information is incorrect, it could delay the processing of your excise return. If you are still unsure, the ATO provides further excise information here.

You may have heard of the term ‘underbond’ mentioned in relation to excise goods. This occurs where excise duty hasn’t been paid on excisable goods. If you wish to store underbond goods, you need an excise license. Furthermore, if you intend to move or export underbond goods, you must also be granted permission from the ATO before moving or exporting your goods.

Start your ABN application in minutes!

Need an Australian Business Number to start a casual job? We've got you covered.

What excise duty rate should I use? 

As rates do often change, it’s important you ensure you are using the correct excise duty rates when calculating your liability. For those unsure what duty rates apply, the ATO provides tables that reflect the specific excise duty rates that apply. These tables are simplifications of the Schedule to the Excise Tariff Act 1921. For more information, follow these specific links for the excise duty rates for Alcohol, Fuel, and Tobacco respectively. Therefore, If you are going to be dealing with excisable goods, we recommend you become familiar with these specific rates.

Final Thoughts

In conclusion, if your business deals with excisable goods, it’s important you are aware of your specific responsibilities. Our lawyers are able to assist you in any issues you might have.

Don't know where to start?

Contact us on 1800 529 728 to learn more about customising legal documents, obtaining a fixed-fee quote from our network of 600+ expert lawyers or to get answers to your legal questions.

Most Popular Articles
You may also like
Recent Articles

Get the latest news

By clicking on 'Sign up to our newsletter' you are agreeing to the Lawpath Terms & Conditions

Share:

Register for our free live webinar today!

Tax Strategies for Small Business Success

12:00pm AEDT
Thursday 25th July 2024

By clicking on 'Register for webinar' you are agreeing to the Lawpath Terms & Conditions

You may also like

The 2024 Federal Budget has unveiled a comprehensive package of measures designed to support small to medium enterprises (SMEs) in Australia, while also laying the groundwork for a "Future Made in Australia."
Default interest clauses can help protect lenders' interests, but sometimes they will not be enforceable. Find out more here.
Lying on your resume to get a job is never a good idea. In fact obtaining employment through fraud can actually land you in jail.

Thank you!

Your registration is confirmed. Keep an eye on your inbox for an email with details on how to watch the webinar.