ATO Interpretative Decision

ATO ID 2001/453

Goods and Services Tax

GST and taxes, fees or charges
FOI status: may be released

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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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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 an entity, an Australian government agency, making a taxable supply under section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it charges a recipient for an Australian tax, fee or charge specified in a written determination of the Treasurer?

Decision

No, the entity is not making a taxable supply under section 9-5 of GST Act when it charges a recipient for an Australian tax, fee or charge specified in a written determination of the Treasurer.

Facts

The entity is an Australian government agency. The entity provides a supply to a recipient. The entity charges the recipient of the supply an amount that represents an Australian tax, fee or charge as defined in section 195-1 of the GST Act. The Australian tax fee or charge is specified in a written determination of the Treasurer. The entity makes the supply in the course and furtherance of its enterprise and the supply is connected with Australia.

The entity is registered for goods and services tax (GST).

Reasons for Decision

Under section 9-5 of the GST Act, an entity makes a taxable supply if:

•: the entity makes a supply for consideration; and
•: the supply is made in the course or furtherance of an enterprise that the entity carries on; and
•: the supply is connected with Australia; and
•: the entity is registered, or required to be registered.

The entity is registered for GST and is making a supply that is connected with Australia in the course and furtherance of its enterprise. The issue in this case is whether the entity's supply is for consideration.

Section 9-15 of the GST Act states that consideration includes any payment, act or forbearance, in connection with or in response to or for the inducement of a supply of anything. However, subsection 81-5(2) of the GST Act provides that the payment of any Australian tax, fee or charge that is specified in a written determination of the Treasurer, or the discharging of a liability to make such a payment, is not the provision of consideration. Subsection 81-5(4) of the GST Act provides that section 81-5 of the GST Act has effect despite section 9-15 of the GST Act.

In this case, as the amount is for an Australian tax, fee or charge that is specified in a written determination of the Treasurer, the payment of the amount is not the provision of consideration. The entity is making a supply for no consideration.

Therefore, the supply does not meet all the requirements of section 9-5 of the GST Act and the entity is not making a taxable supply when it charges a recipient for an Australian tax, fee or charge specified in a written determination of the Treasurer.

Date of decision: 23 August 2001

Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
   section 9-5
   section 9-15
   section 81-5
   subsection 81-5(2)
   subsection 81-5(4)
   section 195-1

Keywords
Goods and services tax
GST payment of taxes
GST supplies without consideration

Business Line: GST

Date of publication: 11 October 2001

ISSN: 1445-2782

history

	Date:	Version:
You are here →	23 August 2001	Original statement
	7 October 2005	Archived

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