Edited version of private advice

Authorisation Number: 1051648212914

Date of advice: 1 April 2020

Ruling

Subject: GST on decals for scooters

Question

Is the importation of decals for scooters a non-taxable importation under section 13-10 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)?

Answer

Yes, the importation of decals for scooters is a non-taxable importation under section 13-10 of the GST Act.

Relevant facts and circumstances

You are registered for goods and services tax (GST). You import decals (stickers) for mobility scooters that are designed for people with an illness or disability.

The stickers are imported and used on the scooters prior to your sale of the scooters. You do not supply the stickers separately.

Relevant legislative provisions

A New Tax System (Goods and Services Tax) Act 1999 subsection 38-45(1)

A New Tax System (Goods and Services Tax) Act 1999 section 13-10

Reasons for decision

You make a non-taxable importation under section 13-10 of the GST Act if:

a)    It is a non-taxable importation under Part 3-2 of the GST Act, or

b)    It would have been a supply that was GST-free or input taxed if it had been a supply.

Paragraph 13-10(a) is not being considered in this ruling. Paragraph 13-10(b) requires us to consider whether the stickers for the scooters would be GST-free or input taxed had they been a supply made in the Indirect tax zone.

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

·         It is covered by Schedule 3 to the GST Act or specified in the A New Tax System (Goods and Services Tax) Regulation 2019 (GST Regulations), and

·         Is specifically designed for people with an illness or disability, and

·         Is not widely used by people without an illness or disability.

Item 106 of Schedule 3 to the GST Act (Item 106) lists 'accessories associated with wheelchairs, motorised wheelchairs, scooters, tricycles, spinal carriages and other goods for the carriage of people with disabilities.'

You have stated that you use the decal stickers on scooters which are GST-free under Item 105 which is 'wheelchairs, motorised wheelchairs, scooters, tricycles, spinal carriages and other goods for the carriage of people with disabilities.'

Therefore, we need to determine if the decal stickers is an accessory for a GST-free scooter. The word 'accessories' is not defined in the GST Act. Accordingly, it is appropriate to examine the ordinary meaning of that word.

The Macquarie Dictionary online defines the word 'accessories' to be the plural of the word accessory. The word accessory is defined to include the following meaning:

'1. a subordinate part or object; something added or attached for convenience, attractiveness, etc., such as a spotlight, heater, driving mirror, etc., for a vehicle. 2. (plural) the additional parts of an outfit, as shoes, gloves, hat, handbag, etc.'

The decal stickers are objects attached to the scooters for convenience to the owners. It is considered that the stickers are accessories associated with scooters. You have stated these stickers are made specifically for the GST-free scooters.

The stickers are designed to be attached on a GST-free scooter for the convenience of the users who are predominantly people with an illness or disability as the scooters have been determined to be GST-free under subsection 38-45(1) of the GST Act. Therefore, the stickers are specifically designed for people with an illness or disability and not widely used by people without an illness or disability. As such, if the stickers were supplied in the Indirect tax zone they would be GST-free under subsection 38-45(1) of the GST Act.

Therefore, the importation of the stickers is a non-taxable importation under section 13-10 of the GST Act.