TAXATION RULING NO. ST 2444

ST 2444

SALES TAX: FLOOR COVERINGS

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FOI status:

May be releasedFOI number: I 1010946

PREAMBLE

This Ruling expands on the classification of certain kinds of vinyl and rubber flooring dealt with generally in Taxation Ruling No. ST 2435.

FACTS

2. As indicated in Taxation Ruling No. ST 2435 a wide range of vinyl and rubber floor coverings are used in domestic homes and the residential areas of hospitals, hotels, homes for the aged, guest houses and the like. Although they may have other features, the majority of vinyl and rubber flooring used for household purposes have a smooth texture finish and generally are of a thickness of 2.00mm or less. Ordinarily a thickness of 2.00mm is sufficient for household use.

3. There is also on the market a range of vinyl and rubber floor coverings which have a smooth texture finish and have a thickness of 2.00mm or less but which are sold principally for industrial use because they have certain characteristics necessary for industrial use. These characteristics include:-

(a)

static reduction;

(b)

bacteria, chemical, heat, oil, fat, or stain resistant; and

(c)

smoke inhibitors to reduce smoke emission in case of fire and to reduce toxicity.

In appearance, these floor coverings are difficult to distinguish from those sold principally for household use.

4. A further range of vinyl and rubber floor coverings are those with raised, ribbed or studded surfaces. While they vary in thickness, these kinds of floor coverings are ordinarily used in commercial or industrial areas. Any use in households is limited.

RULING

5. Subparagraph 1(l), Third Schedule, covers floor coverings of a kind ordinarily used for household purposes. Because it would be difficult to distinguish one range of smooth texture floor covering from another range of the same style of floor covering, it has been decided to accept that all smooth texture floor coverings with a thickness of 2.00mm or less should be regarded as the same kind for the purpose of subparagraph 1(l).

6. Accordingly all smooth texture vinyl and rubber floor coverings with a thickness of 2.00mm or less are covered by subparagraph 1(l), Third Schedule, and taxable at 10%, irrespective of any industrial characteristics they may have or the fact that the majority of purchasers will use the floor coverings in an industrial setting.

7. Smooth texture vinyl and rubber floor coverings with a thickness in excess of 2.00mm will continue to be classified in accordance with the guidelines set out in Taxation Ruling No. ST 2435.

8. Floor coverings that have a raised, ribbed or studded surface are not ordinarily sold for use for household purposes and are not considered to be of a kind ordinarily used for household purposes. They are taxable at the general rate of 20% unless in particular cases the requirements in paragraph 12 of Taxation Ruling No. ST 2435 are satisfied.

9. In Taxation Ruling No. ST 2296, the Alpin 3000 floor covering was ruled to be taxable at 20%. Evidence of sales of that product now indicates that the floor covering is of the type used to a significant extent for household purposes. It is therefore covered by the Third Schedule and taxable at the rate of 10%.

10. Taxation Ruling No. ST 2296 is accordingly withdrawn as the two products referred to in that Ruling, Alpin 3000 and Altro Safety Flooring have now, on the receipt of further evidence of sales, been ruled to be taxable at 10% (by Taxation Ruling No ST 2435 and this Ruling).

COMMISSIONER OF TAXATION
20 October 1988

References

ATO references:
NO 87/10418-4

Date of effect:
1 September 1988

Related Rulings/Determinations:

ST 2435

Subject References:
DOMESTIC & INDUSTRIAL/ COMMERCIAL FLOOR COVERINGS AND MATTING

Legislative References:
SALES TAX (EXEMPTIONS AND CLASSIFICATIONS) ACT; SUBPARAGRAPH 1(l),THIRD SCHEDULE