Goods and Services Tax Industry Issues
Tourism and Hospitality Industry Partnership
Aircraft fees and levies
Please note that the PDF version is the authorised version of this ruling.This publication is extracted from the Tourism and Hospitality Industry Partnership - issues register. See travel agents issue 16 of that register. This publication should be read in conjunction with the related content of that register where further context is required.
This publication provides you with the following level of protection:
This publication (excluding appendixes) is a public ruling for the purposes of the Taxation Administration Act 1953.
A public ruling is an expression of the Commissioner's opinion about the way in which a relevant provision applies, or would apply, to entities generally or to a class of entities in relation to a particular scheme or a class of schemes.
If you rely on this ruling, the Commissioner must apply the law to you in the way set out in the ruling (unless the Commissioner is satisfied that the ruling is incorrect and disadvantages you, in which case the law may be applied to you in a way that is more favourable for you - provided the Commissioner is not prevented from doing so by a time limit imposed by the law). You will be protected from having to pay any underpaid tax, penalty or interest in respect of the matters covered by this ruling if it turns out that it does not correctly state how the relevant provision applies to you.
Aircraft noise levy
3. Aircraft noise levy is charged to airlines landing jet aircraft at Sydney Aerodrome under authority of the Aircraft Noise Levy Act 1995. This charge is administered by the Department of Transport and Regional Services (DOTARS).
4. As charges levied on airlines under the Aircraft Noise Levy Act 1995 are included in part 1 of schedule 1 of the A New Tax System (Goods and Services Tax) (Exempt Taxes, Fees and Charges) Determination 2004 (Treasurer's Division 81 Determination), they are not consideration for taxable supplies.
5. The airlines recover their aircraft noise levy costs by levying an amount per passenger, currently $3.40. The levy may be shown as a separate amount on tickets. The levy amount shown on the ticket is not a personal liability of the passenger and is considered to be part of the price of the airfare. GST applies to this amount in the same manner as it applies to the transport service.
Passenger movement charge
7. Passenger movement charge is a per passenger amount levied under section 5 of the Passenger Movement Charge Act 1978 which is administered by the Australian Customs Service (ACS). It is collected by international airline operators on behalf of ACS. The passenger movement charge is imposed on a person departing Australia.
9. The ATO understands that these charges are the personal liability of each passenger. Accordingly, GST does not apply to these charges. In addition, as the charge only applies to international departures, it would otherwise have formed part of the consideration for a GST-free supply of international transport.
Domestic head tax
11. Schedule 1 of the Treasurer's Division 81 Determination does not contain any references to per passenger fees, levies or charges for landing at regional airports. The schedule to the Determination does provide that the 'Airport Passenger Levy' charged under authority of Lord Howe Island Act 1953, is not treated as consideration for a separate supply when charged to the airlines. Accordingly, GST does not apply to these amounts when charged to the airlines.
Other ticket service fees and charges
13. Other ticket fees such as re-issue fees, re-booking fees, re-validation fees and prepaid ticket advice services fees are GST-free if they relate to GST-free transport. These services are considered to be arranging GST-free transport in accordance with item 7 of the table in section 38-355 (see Issue 11 - Land fall requirement).
|Type of fee||Division 81||Domestic ticket (taxable)||Domestic ticket (GST-free)1||International ticket (GST-free)|
|Cancellation fee - flight||No||GST||GST-free||GST-free|
|Cancellation penalty - flight||No||GST||GST-free||GST-free|
|Lost ticket indemnity service fee||No||GST||GST-free||GST-free|
|Prepaid ticket advice service fee||No||GST||GST-free||GST-free|
|Passenger movement charges||Yes||N/A||N/A||Not a taxable supply|
|Aircraft noise levy||Yes||GST||GST-free||GST-free|
- a domestic flight forms part of a ticket for international travel or is cross-referenced to an international ticket and is purchased at any time up to and including the date of international travel, or
- the domestic air ticket was purchased by a non-resident while outside Australia.