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Subject: GST and importation of gold bars and gold nuggets
Question 1
Will GST be payable on your importation of gold bars?
Answer
No.
Question 2
Will GST be payable on your importation of gold nuggets?
Answer
GST will be payable on your importation of the gold nuggets unless the importation of the gold nuggets is a non-taxable importation by virtue of subsection 42-5(1) or 42-5(1C) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act),
Australian Customs and Border Protection Service (Customs) will determine whether the importation of the gold nuggets is a non-taxable importation by virtue of subsection 42-5(1) or subsection 42-5(1C) of the GST Act.
This ruling applies for the following periods:
Year ended 30 June 2012
Year ended 30 June 2013
The scheme commences on:
1 July 2011
Relevant facts and circumstances
You will purchase gold bars and gold nuggets overseas and import them into Australia.
The gold bars will bear marks or characteristics accepted as identifying and guaranteeing their fineness and quality.
The gold will usually be traded at a price that is determined by reference to the spot price of gold.
The gold will be of (a certain percentage) fineness.
Relevant legislative provisions
A New Tax System (Goods and Services Tax) Act 1999 subsection 13-5(1)
A New Tax System (Goods and Services Tax) Act 1999 section 13-10
A New Tax System (Goods and Services Tax) Act 1999 section 40-100
A New Tax System (Goods and Services Tax) Act 1999 subsection 42-5(1)
A New Tax System (Goods and Services Tax) Act 1999 subsection 42-5(1C)
A New Tax System (Goods and Services Tax) Act 1999 section 195-1
Reasons for decisions
Summary for questions 1 and 2
Your gold bars
GST will not be payable on your importation of the gold bars because it will be an importation of precious metal.
Your gold nuggets
GST will be payable on your importation of the gold nuggets unless the importation of the gold nuggets is a non-taxable importation by virtue of subsection 42-5(1) or 42-5(1C) of the GST Act.
Detailed reasoning for questions 1 and 2
GST is payable on taxable importations.
An importation is a taxable importation if the requirements of subsection 13-5(1) of the GST Act are satisfied. Subsection 13-5(1) of the GST Act states:
You make a taxable importation if:
(a) goods are imported; and
(b) you enter the goods for home consumption (within the meaning of the Customs Act 1901).
However, the importation is not a taxable importation to the extent that is a
*non-taxable importation.
(*denotes a term defined in section 195-1 of the GST Act)
In your case, goods will be imported. Hence, you will satisfy the requirement of paragraph 13-5(1)(a) of the GST Act.
You will enter the goods for home consumption. Hence, you will satisfy the requirement of paragraph 13-5(1)(b) of the GST Act.
Section 13-10 of the GST Act sets out when an importation will be a non-taxable importation. It states:
An importation is a non-taxable importation if:
(a) it is a non-taxable importation under Part 3-2; or
(b) it would have been a supply that was *GST-free or *input taxed if it had been a supply.
Section 40-100 of the GST Act provides that a supply of precious metal is input taxed.
Section 195-1 of the GST Act defines precious metal. 'Precious metal' includes gold (in an investment form) of at least 99.5% fineness.
Paragraph 29 of Goods and Services Tax Ruling GSTR 2003/10 explains when gold is in investment form. It states:
29. To summarise the above, for gold, silver or platinum to be in an investment form for the purposes of the GST Act, it must be in a form that:
· is capable of being traded on the international bullion market, that is, it must be a bar, wafer or coin;
· bears a mark or characteristic accepted as identifying and guaranteeing its fineness and quality; and
· is usually traded at a price that is determined by reference to the spot price of the metal it contains.
Your gold bars
You will import gold in the form of bars.
The gold bars:
· will bear marks or characteristics accepted as identifying and guaranteeing their fineness and quality;
· will usually be traded at a price that is determined by reference to the spot price of gold; and
· will be of at least 99.5% fineness.
Therefore, you will import precious metal by importing the gold bars.
Hence, if your importation of the gold bars would have been a supply, it would have been an input taxed supply.
Therefore, your importation of the gold bars will be a non-taxable importation.
Hence, your importation of the gold bars will not be a taxable importation.
Therefore, GST will not be payable on your importation of the gold bars.
Your gold nuggets
You will import gold nuggets.
The gold nuggets will not be in the form of bars, wafers or coins. Therefore, they will not be in an investment form. Hence, they will not be precious metals.
Therefore, the GST exemption for importation of precious metals will not apply to your importation of the gold nuggets.
There are no provisions in the GST Act under which, if your importation of the gold nuggets was a supply, it would have been GST-free or input taxed.
An importation may be a non-taxable importation under subsection 42-5(1) or subsection 42-5(1C) of the GST Act - these provisions form part of Part 3-2 of the GST Act.
Subsection 42-5(1) of the GST Act states:
An importation of goods is non-taxable importation if the goods are
covered by item 4, 8, 15, 18A, 18B, 18C, 21, 21A, 23A, 23B, 24, 25A, 25B, 25C, 32A, 32B, 33A, 33B or 64 in Schedule 4 to the Customs Tariff Act 1995.
Subsection 42-5(1C) of the GST Act states:
An importation of goods is a non-taxable importation if the goods are covered by:
· item 1A, 1B, 1C, 1D, 1E, 5, 6, 9 or 16 in Schedule 4 to the Customs Tariff Act 1995; and
· regulations made for the purposes of this subsection.
Customs will determine whether the importation of the gold nuggets is a non-taxable importation by virtue of subsection 42-5(1) or subsection 42-5(1C) of the GST Act.
If the importation of the gold nuggets is a non-taxable importation by virtue of subsection 42-5(1) or 42-5(1C) of the GST Act, it will not be a taxable importation. Therefore, under such circumstances, GST will not be payable on the importation of the gold nuggets.
If the importation of the gold nuggets is not a non-taxable importation by virtue of subsection 42-5(1) or subsection 42-5(1C) of the GST Act, it will be a taxable importation. Therefore, under such circumstances, GST will be payable on the importation of the gold nuggets.
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