ATO Interpretative Decision
ATO ID 2002/865
Goods and Services Tax
GST and walking sticksFOI status: may be released
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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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 the entity, a supplier of medical aids and appliances, making a GST-free supply under subsection 38-45(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it supplies a walking stick?
Decision
Yes, the entity is making a GST-free supply under subsection 38-45(1) of the GST Act when it supplies a walking stick.
Facts
The entity is a supplier of medical aids and appliances. The entity supplies a walking stick. The walking stick is designed to aid a person to walk. The walking stick is not non-functional nor is it purely ornamental.
The walking stick is specifically designed for people with an illness or disability and is not widely used for people without an illness or disability.
There is no agreement between the entity and the recipient that the supply is not to be treated as a GST-free supply.
The entity is registered for goods and services tax (GST).
Reasons for Decision
Under subsection 38-45(1) of the GST Act, the supply of a medical aid or appliance is GST-free where the medical aid or appliance:
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- is covered by Schedule 3 to the GST Act (Schedule 3), or specified in the A New Tax System (Goods and Services Tax) Regulations 2019(GST Regulations); and
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- is specifically designed for people with an illness or disability; and
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- is not widely used by people without an illness or disability.
Item 97 in the table in Schedule 3 (Item 97) lists 'walking sticks - specialised'.
A specialised walking stick is a hand held device the principal function of which is to assist a person to walk by taking some of the weight of that person. Walking sticks that are non-functional or are purely ornamental are not walking sticks for the purposes of Item 97.
The entity is supplying a walking stick that assists people to walk. They are not purely ornamental nor are they non-functional. Therefore, the walking stick is covered by Item 97.
In addition, the walking stick is specifically designed for people with an illness or disability and is not widely used by people without an illness or disability. As such, the requirements in subsection 38-45(1) of the GST Act are met.
Therefore, the entity is making a GST-free supply under subsection 38-45(1) of the GST Act when it supplies a walking stick.
Amendment History
| Date of Amendment | Part | Comment |
|---|---|---|
| 9 April 2019 | Throughout | Updated A New Tax System (Goods and Services Tax) Regulations 1999 to A New Tax System (Goods and Services Tax) Regulations 2019. |
Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
section 13-10
subsection 38-45(1)
Schedule 3
Schedule 3 table item 97
The Regulations
Keywords
Goods and services tax
GST free
GST health
Section 38-45 - medical aids & appliances
ISSN: 1445-2782