ATO Interpretative Decision
ATO ID 2002/12
Good and Services Tax
GST and an emergency assistance lightFOI status: may be released
This ATOID provides you with the following level of protection:
If you reasonably apply this decision in good faith to your own circumstances (which are not materially different from those described in the decision), and the decision is later found to be incorrect you will not be liable to pay any penalty or interest. However, you will be required to pay any underpaid tax (or repay any over-claimed credit, grant or benefit), provided the time limits under the law allow it. If you do intend to apply this decision to your own circumstances, you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed. You may wish to obtain further advice from the Tax Office or from a professional adviser.
Issue
Is the entity, a supplier of emergency devices, making a GST-free supply under subsection 38-45(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it supplies an emergency assistance light?
Decision
No, the entity is not making a GST-free supply under subsection 38-45(1) of the GST Act when it supplies an emergency assistance light. The entity is making a taxable supply under section 9-5 of the GST Act.
Facts
The entity is a supplier of emergency devices. The entity is supplying an emergency assistance light.
The product is a portable battery powered, flashing light that can be attached to the outside of a property or can be hand held. When activated, it emits a bright flashing light that can be seen for about 300 metres in daylight or 5 to 8 kilometres in darkness. A person in need of emergency assistance contacts the relevant emergency service, and then manually activates the emergency assistance light. The flashing light enables the responding emergency service (eg ambulance) to quickly locate the premises of the person requiring assistance.
The entity is registered for goods and services tax (GST). The supply of the emergency assistance light satisfies the other positive limbs of section 9-5 of the GST Act.
Reasons for Decision
Under subsection 38-45(1) of the GST Act, the supply of a medical aid or appliance is GST-free where the medical aid or appliance:
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- is covered by Schedule 3 to the GST Act (Schedule 3), or specified in the A New Tax System (Goods and Services Tax) Regulations 2019(GST Regulations); and
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- is specifically designed for people with an illness or disability; and
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- is not widely used by people without an illness or disability.
Item 33 in the table in Schedule 3 (Item 33) lists 'medical alert devices'. It is considered that a 'medical alert device' is a device that is designed for the purpose of alerting medical/caring personnel or an ambulance service to the fact that a person is in need of emergency medical assistance or that the person has a medical condition that may require specific treatment.
In this case, the emergency assistance light is used as a locating beacon to assist the relevant emergency service in finding a person in need of assistance. The device is activated after the emergency service has already been advised of a person's need for assistance. As such, the device itself is not used to alert the emergency service of the need for assistance. Therefore, the emergency assistance light is not a 'medical alert device' and is not covered by Item 33.
There are no items specified in the GST Regulations that are relevant to this case, nor are there any other items listed in Schedule 3 that could cover the device.
As the emergency assistance light is not covered by Schedule 3 or specified in the GST Regulations, the entity is not making a GST-free supply under subsection 38-45(1) of the GST Act.
The entity is registered for GST and the supply meets the other positive limbs of section 9-5 of the GST Act. Furthermore, the supply is neither GST-free under Division 38 of the GST Act nor input taxed under Division 40 of the GST Act. Therefore, the entity is making a taxable supply under section 9-5 of the GST Act when it supplies the emergency assistance light.
Amendment History
| Date of Amendment | Part | Comment |
|---|---|---|
| 9 April 2019 | Throughout | Updated A New Tax System (Goods and Services Tax) Regulations 1999 to A New Tax System (Goods and Services Tax) Regulations 2019. |
Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
section 9-5
Division 38
subsection 38-45(1)
Division 40
Schedule 3
Schedule 3 table item 33
The Regulations
Keywords
Goods & services tax
GST free
GST health
Section 38-45 - medical aids & appliances
GST supplies & acquisitions
Taxable supply
ISSN: 1445-2782