Edited version of private advice

Authorisation Number: 1052472478790

NOTICE

This is an edited version of a revised private ruling. It replaces the edited version of the private ruling with the authorisation number 1052463614628.

Date of advice: 22 February 2024

Date of advice: 07 November 2025

Ruling

Subject: GST - medical alert device

Question 1

Is the supply of the following products by xxxx (you) GST-free under subsection 38-45(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act): xxxx?

Answer 1

Yes. The supply of the following products by you is GST-free under subsection 38-45(1) of the GST Act: xxxx.

This ruling applies for the following period:

7 November 20xx to 31 March 20xx

The scheme commenced on:

xx/xx/xxxx

Relevant facts and circumstances

xxxx (you) are registered GST and lodge BAS returns quarterly.

As part of your primary business activities, you supply medical alert devices.

Sales of the products occur via your website. You currently have no third-party retailers. You are preparing to expand into pharmacies and health stores.

You are a registered NDIS provider.

Relevant legislative provisions

A New Tax System (Goods and Services Tax) Act 1999 section 38-45

Reasons for Decision

Under subsection 38-45(1) of the GST Act, a supply of a medical aid or appliance is GST-free if the medical aid or appliance:

a)            is covered by Schedule 3 to the GST Act, or in the A New Tax System (Goods and Services Tax) Regulations 2019 (GST Regulations); and

b)            is specifically designed for people with an illness or disability and is not widely used by people without an illness or disability.

For a medical aid or appliance to be GST-free it must meet all of the above conditions.

Paragraph 38-45(1)(a) - covered by Schedule 3

Item 33 in Schedule 3 to the GST Act (Item 33) lists 'medical alert device.'

For the purposes of Item 33, a 'medical alert' device' is interpreted to mean a device which is designed for the purpose of alerting medical or caring personnel, or an ambulance service, that a person is in need of emergency medical assistance or that the person has a medical condition that may require specific treatment.

In a Sales Tax context, in determining how goods might be covered by one or other of the items in the various Schedules, the tribunals and courts have often looked to the 'essential character' or 'objective characterisation' of goods.

Essential character tests have been established by the Courts in cases such as Thomson Australia Holdings Pty Ltd v. Federal Commissioner of Taxation (1988) 20 FCR 85; 88 ATC 4916; (1988) 19 ATR 1896 and FC of T v. Rotary Offset Press Pty Ltd 71 ATC 4170; (1971) 2 ATR 411. Davies J. said in Thomson Australia Holdings:

the task of the court is to determine the essential character of the goods, what essentially the goods are, not some characteristic that the goods might have. Essential character derives from the basic nature of the goods, from what they are, though composition, function and other factors necessarily play a part.

Similarly, for GST, to determine whether a thing is covered by an item in Schedule 3 or the GST Regulations, it is considered necessary to have regard to the essential character of the thing. This means deciding what the goods essentially are, as distinct from merely identifying one of a number of characteristics the goods might have. This approach relies upon deciding what is the basic nature of the goods and involves consideration of what the goods might be used for.

The primary purpose of a 'medical alert' device is to alert. In this case the product/s features identify the device as a medical alert. Therefore, it is considered the product is a medical alert device and satisfies paragraph 38-45(1)(a) of the GST Act.

Specifically designed and not widely used

Based on the design intentions of your product and the marketing of the product, it is considered the devices are also specifically designed for people with an illness or disability and not widely used by people without an illness or disability and therefore satisfies paragraph 38-45(1)(b) of the GST Act. Therefore, the supply of the products is GST-free under subsection 38-45(1) of the GST Act.

As Item 33 applies, the Commissioner has not considered whether the products fall within another item in Schedule 3

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