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Edited version of your written advice
Authorisation Number: 1012881261763
Date of advice: 23 September 2015
Ruling
Subject: GST and the application of Division 81 to Government fees and charges
Question 1
Do the following fees and charges attract GST?
(a) annual rent paid for a title or a non-compliant existing interest pursuant to Act.
(b) an annual fee for a permit, a licence or pursuant to the Act.
(c) an annual fee for a permit, a licence, pursuant to the Act.
(d) an annual licence fee pursuant to the Act.
(e) an annual fee in respect of a permit, a licence or a lease pursuant to the Act.
Answer 1
(a) No
(b) No
(c) No
(d) No
(e) No
Question 2
Are application fees relating to Question 1 out-of-scope for GST?
Answer 2
Yes
Question 3
Is the response to questions 1(a) to 1(b) and question 2 the same where the permit, lease or licence relates to another government agency's land?
Answer 3
Yes
Relevant facts and circumstances
Entity is an Australian Government agency and is registered for GST.
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 Subsection 81-10(1)
A New Tax System (Goods and Services Tax) Act 1999 Subsection 81-10(2)
A New Tax System (Goods and Services Tax) Act 1999 Subsection 81-10(2)
A New Tax System (Goods and Services Tax) Act 1999 Subsection 81-10(4)
A New Tax System (Goods and Services Tax) Act 1999 Subsection 81-15
A New Tax System (Goods and Services Tax) Regulations 1999 81-15.01
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.
Division 81
Division 81 allows entities to self-assess the GST treatment of a payment of an Australian tax or an Australian fee or charge in accordance with certain principles.
Australian Fees and Charges
Sections 81-10 and 81-15 consider the effect of certain fees and charges and state:
81-10 Effect of payment of certain fees and charges
Certain fees and charges not consideration
(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).
(2) However, a payment you make, or a discharging of your liability to make a payment, is treated as the provision of consideration to the extent the payment is an *Australian fee or charge that is, or is of a kind, prescribed by the regulations.
(3) For the purposes of subsection (2), the consideration is taken to be provided to the entity to which the fee or charge is payable, for a supply that the entity makes to you.
Fees or charges paid for permissions etc.
(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 term 'Australian fee or charge' is defined in section 195-1 as:
Australian fee or charge means a fee or charge (however described), other than an Australian tax, imposed under an *Australian law and payable to an *Australian government agency.
The Australian fees and charges listed in question 1(a) to 1(e) are not consideration as they are covered by subsection 81-10(4) and excluded by the GST Regulations as they are regulatory.