ATO ID 2002/714: GST and alternative joystick
Date of decision: 5 April 2002
Business line: Indirect Tax

Issue
Is the entity, a supplier of computer equipment, making a GST-free supply under subsection 38-45(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it supplies an alternative joystick?

Decision
Yes, the entity is making a GST-free supply under subsection 38-45(1) of the GST Act when it supplies an alternative joystick.

Facts
The entity is a supplier of computer equipment. The entity supplies an alternative joystick. The alternative joystick is a substitute for a standard mouse designed for people who, due to their disability, are unable to use their hands. The joystick is controlled by the mouth or chin and is activated by a sip/puff switch. The joystick is not widely used by people without an illness or disability. There is no agreement between the entity and the recipient that the supply is not to be treated as a GST-free supply. The entity is registered for goods and services tax (GST).

Reasons for decision
Summary: Under subsection 38-45(1) of the GST Act, the supply of a medical aid or appliance is GST-free where the medical aid or appliance: Item 11 of Schedule 3 (Item 11) lists 'mouth/head sticks/pointers'. The entity is supplying an alternate joystick designed to be controlled by a person's mouth or chin and is activated by a sip/puff switch. This falls within the description of a mouth/head stick in Item 11. Therefore, the alternative joystick is covered by Schedule 3. The alternative joystick is designed for people that are unable to use their hands due to their disability. Therefore it is designed for people with an illness or disability. In addition, the joystick is not widely used by people without an illness or disability. Accordingly, the requirements in subsection 38-45(1) of the GST Act are met. Therefore, the entity is making a GST-free supply under subsection 38-45(1) of the GST Act when it supplies an alternative joystick.

Legislative references: A New Tax System (Goods and Services Tax) Act 1999 subsection 38-45(1) Schedule 3 Schedule 3 table item 11
Subject references: Goods and services tax GST free GST health Section 38-45 - medical aids & appliances