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Edited version of private advice
Authorisation Number: 1052044759484
Date of advice: 12 October 2022
Ruling
Subject: Precious metals
Question 1
Is palladium a precious metal?
Answer
No.
Question 2
Is a supply of palladium input taxed under section 40-100 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)?
Answer
No.
Question 3
Is the importation of palladium a non-taxable importation under section 13-10 of the GST Act?
Answer
No.
This ruling applies for the following period:
22 August 20XX to 22 August 20XX
The scheme commences on:
22 August 20XX
Relevant facts and circumstances
You purchased physical palladium from a precious metals dealer based in the Country A. The total value of your exceeded $XX AUD.
The bars are produced by a London Bullion Market Association (LBMA) accredited refiner. The bars are stamped with an internationally accepted hallmark, guaranteeing their fineness and quality.
Palladium is traded on the international bullion market, at a price determined by reference to the spot price of palladium.
Upon its arrival in Australia, Customs held your shipment & requested additional documentation to confirm the correct usage of the GST Exemption Code GSTE = LPM (Precious metals). Ultimately, Customs determined that your shipment did not meet the requirements for a GST exemption under the exemption code for precious metals.
Relevant legislative provisions
A New Tax System (Goods and Services Tax) Act 1999 Section 13-10
A New Tax System (Goods and Services Tax) Act 1999 Section 40-100
A New Tax System (Goods and Services Tax) Act 1999 Section 195-1
Reasons for decision
Section 195-1 of the GST Act defines 'precious metal' as:
(a) gold (in an investment form) of at least 99.5% fineness; or
(b) silver (in an investment form) of at least 99.9% fineness; or
(c) platinum (in an investment form) of at least 99% fineness; or
(d) any other substance (in an investment form) specified in the regulations of a particular fineness specified in the regulations.
Currently, the A New Tax System (Goods and Services Tax) Regulations 2019 (GST Regulations) do not contain a definition for the term 'precious metal'. This means that only gold, silver & platinum (in an investment form) of the specified fineness are considered precious metal for the purpose of the GST Act. Palladium, regardless of its form or fineness, does not satisfy the definition of 'precious metal'.
Under section 40-100 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), a supply of precious metal is input taxed. Palladium is not a precious metal and therefore it is not input taxed under section 40-100 of the GST Act.
Under section 13-10 of the GST Act, an importation is a non-taxable if:
(a) it is a non-taxable importation under Part 3-2; or
(b) it would have been a supply that was GST-free or input taxed if it had been a supply.
None of the provisions within Part 3-2 of the GST Act apply to an importation of palladium. Likewise, a supply of palladium, within Australia, is neither GST-free nor input taxed. Therefore, an importation of palladium is not a non-taxable importation.