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Edited version of private advice
Authorisation Number: 1051915745266
Date of advice: 29 October 2021
Ruling
Subject: GST - medical aids and appliances
Question
Is Product A, a medical aid or appliance in accordance with subsection 38-45(1) of A New Tax System (Goods and Services Tax) Act 1999 (GST Act) and therefore GST-free?
Answer
No, Product A is not a medical aid or appliance in accordance with subsection 38-45(1) of the GST Act and therefore is not GST-free.
The scheme commences on:
1 July 20XX
Relevant facts and circumstances
Product A is a corrector for protruding ears made from silicon and medical adhesives. It adheres to the ear and the contiguous part of the head, providing an immediate natural effect.
Product A is used to pin back excessively protruding ears and is available for children and adults. Each Product A can last from 3 days to a week or sometimes more if properly applied.
Product A is registered as Medical Device Class 1 by Therapeutic Goods Administration (TGA) Australia.
The Australian Register of Therapeutic Goods (ARTG) is a register of therapeutic goods that can be lawfully supplied in Australia. Product A is registered with ARTG.
Relevant legislative provisions
A New Tax System (Goods and Services Tax) Act 1999 (GST Act) subsection 38-45(1)
Reasons for decision
Under subsection 38-45(1) of GST Act, the supply of a medical aid or appliance is GST-free where the medical aid or appliance meet all of the following criteria:
- 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)
- is specifically designed for people with an illness or disability, and
• is not widely used by people without an illness or disability.
A medical aid or appliance can only be GST-free if it is listed in Schedule 3 to the GST Act or in the GST Regulations. The ATO cannot treat a medical aid or appliance as GST-free and cannot give a ruling that a medical aid or appliance is GST-free if it is not listed in Schedule 3 to the GST Act or in the GST Regulations.
Only the Australian Government, and not the ATO, can add new medical aids and appliances to Schedule 3 to the GST Act or the GST Regulations.
Items listed in Schedule 3 of the GST Act can be assessed by this link:
https://www.ato.gov.au/law/view/document?DocID=PAC/19990055/Sch3&PiT=99991231235958
Items listed in the GST Regulations can be assessed by this link:
https://www.ato.gov.au/law/view/document?DocID=REG/20190417/38-45.01&PiT=99991231235958
Product A is not listed in Schedule 3 of the GST Act or in the GST Regulations and therefore is not GST-free for the purposes of subsection 38-45 of the GST Act.