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Edited version of your written advice
Authorisation Number: 1013104066743
Date of advice: 11 October 2016
Ruling
Subject: Government taxes fees and charges
Question 1
Is GST payable on a levy which you collect on behalf of a government authority?
Answer 1
No, the levy is a government fee or charge which is excluded from goods and services tax (GST).
Relevant facts and circumstances
• You are registered for GST.
• You are a consultant professional.
• You collect a levy on behalf of a government agency.
• The Levy is imposed under an Act.
• You put the levies in your business account and forward them to the authority on a monthly basis.
Relevant legislative provisions
A New Tax System (Goods and Services Tax) Act 1999 Section 9-5
A New Tax System (Goods and Services Tax) Act 1999 Section 9-10
A New Tax System (Goods and Services Tax) Act 1999 Section 81-10
New Tax System (Goods and Services Tax) Regulations 1999 Subregulation 81-15.01(f)
Reasons for decision
All legislative references in this Ruling, unless otherwise stated are to A New Tax System (Goods and Services Tax) Act 1999 (GST Act). The relevant legislative provisions are discussed below.
Section 9-5 defines a taxable supply as:
9-5 You make a taxable supply if:
(a). you make the supply for *consideration; and
(b). the supply is made in the course or furtherance of an *enterprise you *carry on; and
(c). the supply is *connected with Australia; and
(d). you are *registered or *required to be registered.
However, the supply is not a *taxable supply to the extent that it is *GST-free or *input taxed.
(* denotes a defined term under section 195-1)
GST does not apply to payments of taxes, fees and charges that are excluded from the GST by Division 81 of the GST Act.
Division 81 of the GST Act relates to the payment of taxes, fees and charges. Section 81-10 of the GST Act makes certain fees and charges not consideration and states at subsections 81-10(1):
(1) A payment, or the discharging of a liability to make a payment, is not the provision of *consideration to the extent the payment is an *Australian fee or charge that is of a kind covered by subsection (4) or (5).
And at subsection 81-10(4):
(4) This subsection covers a fee or charge if the fee or charge:
(a) relates to; or
(b) relates to an application for;
the provision, retention, or amendment, under an *Australian law, of a permission, exemption, authority or licence (however described).
The levy is a fee that is covered by subsection 81-10(4) of the GST Act and as such is not consideration for a supply. The levy is also excluded by regulation 81-15.01(f) of the A New Tax System (Goods and Services Tax) Regulations 1999 which lists fees and charges which do not constitute consideration and includes:
(f) a fee or charge for a supply of a regulatory nature made by an Australian government agency;
As the levy is not consideration it is not a taxable supply.
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