3.i. Drugs and medicines which are not on the Australian Register of Therapeutic Goods cannot be supplied in or exported from Australia. However, individuals can legally import most therapeutic goods for personal use under the Personal Import Scheme. This scheme allows for treatments to be imported for personal use in quantities that are no greater than three month's supply. Are these taxable importations?
For source of ATO view, refer to GSTR 2003/15External Link – Goods and services: importation of goods into Australia
Section 13-10 provides that an importation is not a taxable importation if it would have been a GST-free supply, if it had been a supply.
A supply made for consideration, in the course or furtherance of an enterprise carried on by the supplier, connected with Australia, by a supplier that is registered for GST, will be GST-free where one of the GST-free provisions of the GST Act is satisfied.
Accordingly, where the supply of an imported drug or medicine by a registered entity for consideration in the course of or furtherance of an enterprise and connected with Australia would be GST-free, the importation of that drug or medicine by an individual will be a non-taxable importation.
Further, section 42-5 provides that an importation of goods is a non-taxable importation if the goods are covered by item 26 in Schedule 4 to the Customs Tariff Act 1995. Item 26 in Schedule 4 to the Customs Tariff Act 1995 covers imports of goods sent by the postal system, with a value not exceeding $1,000 and goods sent by air and sea cargo, with a value not exceeding $1000, respectively.
Accordingly, goods sent by the postal system, and goods sent by air and sea cargo, with a value not exceeding $1000, are non-taxable importations.