Edited version of your private ruling

Authorisation Number: 1012058624798

This edited version of your ruling will be published in the public register of private binding rulings after 28 days from the issue date of the ruling. The attached private rulings fact sheet has more information.

Please check this edited version to be sure that there are no details remaining that you think may allow you to be identified. If you have any concerns about this ruling you wish to discuss, you will find our contact details in the fact sheet.

Ruling

Subject: GST treatment of supplies of waterproof mattress protectors

Question 1

Are the importation and sale of your waterproof mattress protectors GST-free under the medical aids and appliances exemption?

Answer

Yes.

Relevant facts and circumstances

· The applicant company (you) are registered for GST.

· You intend to launch a range of waterproof mattress protectors (the products). You will import and distribute the products.

· The level of waterproofing of the products is not necessary for those that do not suffer from incontinence.

· All of these products are designed and marketed for incontinence sufferers. You have provided details of the packaging and marketing statements that provide this information.

· The products will be sold at medical stores and pharmacies as well as furniture, bedding and general retailers.

· The price for these products is higher than the prices of other mattress protectors.

Relevant legislative provisions

A New Tax System (Goods and Services Tax) Act 1999

Section 38-45

Schedule 3

Section 13-10

Reasons for decision

Summary

The importation and sale of your waterproof mattress protectors are GST-free under the medical aids and appliances exemption.

Detailed reasoning

Under section 38-45 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) a product is GST free if it is covered by Schedule 3 (medical aids and appliances) and the thing supplied is specifically designed for people with an illness or disability, and is not widely used by people without an illness or disability.

Items 16 and 22 of the table in Schedule 3 list waterproof covers or mattress protectors and waterproof protection for beds and chairs (under the Continence category of the table). Your waterproof mattress protectors fit within these items, particularly item 16. Therefore your waterproof protectors will be GST-free where they are specifically designed for people with an illness or disability, and are not widely used by people without an illness or disability.

We consider that your protectors are specifically designed for people with an illness or disability. Whilst many people may use mattress protectors, a number of factors indicate that your product is specifically designed for special use. Factors such as the level of waterproofing, the marketing information you have provided, the information displayed on the product, the product being available in specialist stores and pharmacies and the higher price of the product compared to normal mattress protectors indicate that the products are designed for this purpose.

While some persons without an illness or disability may also choose to use your product, we consider that the factors outlined above indicate that such use would be uncommon or irregular. The product is specifically designed for people with an illness or disability, but some possible use of the product by persons without an illness or disability does not prevent your product from being considered to be a GST-free medical aid or appliance.

Therefore we consider that supplies of your waterproof mattress protectors will be GST-free supplies as they satisfy section 38-45 of the GST Act. Any importation of the product will be a non-taxable importation under section 13-10 of the GST Act.