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Edited version of private advice
Authorisation Number: 1012621920667
Ruling
Subject: GST and medical aids and appliances
Question
Will your supply of the product be a GST-free supply pursuant to subsection 38-45(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)?
Answer
No
Relevant facts and circumstances
You are registered for GST.
You plan to import a product which you will have manufactured overseas. This is a product which is designed to assist anyone with mobility and flexibility issues to dress and undress without the need for assistance by others.
You provided a description of the product.
You have contended that the product falls under either item 20, 25, 121 or 122 of Schedule 3 of the GST Act.
Relevant legislative provisions
A New Tax System (Goods and Services Tax) Act 1999 9-5,
A New Tax System (Goods and Services Tax) Act 1999 38-45 and
A New Tax System (Goods and Services Tax) Act 1999 Schedule 3.
A New Tax System (Goods and Services Tax) Regulations 1999 Schedule 3.
Reasons for decision
In this ruling, please note:
• All legislative references are to the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) unless otherwise specified.
• All terms marked by an *asterisk are defined terms in the GST Act.
Goods and Services Tax (GST) is payable on taxable supplies. Section 9-5 states:
You make a taxable supply if:
(a) you make a supply for *consideration; and
(b) the supply is made in the course or furtherance of an *enterprise that 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.
As your supplies of the product will be made for consideration, will be sold in Australia in the course of your enterprise, will not be input taxed under Division 40 and you are registered for GST, they will be taxable supplies pursuant to section 9-5 unless they are GST-free.
Subsection 38-45(1) provides that a supply is GST-free if:
(a) it is covered by Schedule 3 (medical aids and appliances) to the GST Act (Schedule 3), or specified in the A New Tax System (Goods and Services Tax) Regulations 1999 (Regulations); and
(b) the thing being supplied is specifically designed for people with an illness or disability, and is not widely used by people without an illness or disability.
The supply must satisfy both conditions in order to be considered a GST-free supply. In your case we accept that your product is designed for people with an illness or disability and is not widely used by people without an illness or disability.
The product is not specified in the Regulations. Schedule 3 to the GST Act lists various items that are GST-free. You have contended that the following items are of relevance:
• Item 20 incontinence appliances
• Item 25 enemas, suppositories and applicators
• Item 121 - toilet supports.
• Item 122 - self-help poles.
We have considered each of these items in turn and their application to your product. The following advice is provided below:
20 Incontinence appliances
Your product is not an appliance designed to assist people with incontinence but is used to assist in dressing and undressing.
25 Enemas, suppositories and applicators
The ATO has considered this item before in regards to various products and provided the following information on the GST Pharmaceutical Health Forum - issues register - Attachment A - Schedule 3 - medical aid or appliance.
Enemas, suppositories and applicators used for the relief of constipation.
Your product does not fit this description, as it is designed to assist in dressing and undressing.
121 Toilet supports
A toilet support is an aid or appliance that has design characteristics such that it assists a disabled person when they are using a toilet. In addition, generally it must be able to support the weight of the disabled person.
Your appliance is not a toilet support but is designed to assist in dressing and undressing.
122 Self-help poles
A self-help pole is an upright frame/pole with a triangular hand grip which hangs over the top of a bed. The hand grip hangs from a chain which can be adjusted in length to suit the individual. The self-help pole is also known as a "Goose neck", "Monkey Grip / Bar", "Self Lifting Stand" or "Overhead Triangle". The pole assists with movement up, down or off a bed or for moving from a lying to a sitting position.
Your appliance is not a self-help pole but is designed to assist in dressing and undressing.
Therefore, as your product is not captured under subsection 38-45(1)(a), it will not be GST- free and will be a taxable supply pursuant to section 9-5.