ATO ID 2002/38: GST and lumbar rolls
Date of decision: 28 September 2001
Business line: Indirect Tax

Issue
Is the entity, a supplier of medical aids and appliances, 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 a lumbar roll?

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

Facts
The entity is a supplier of medical aids and appliances. The entity supplies a lumbar roll. A lumbar roll is a cylindrical cushion that has been manufactured from a special supportive foam and designed to assist with the support or positioning of the lower back area of an individual with a disability, while seated or reclined. In this case, the lumbar roll is specifically designed for people with an illness or disability and is not widely used by people without an illness or disability. The entity is registered for goods and services tax (GST). There is no agreement between the entity and the recipient to treat the supply as not a GST-free supply.

Reasons for decision
Summary: Under subsection 38-45(1) of the GST Act, the supply of a medical aid and appliance is GST-free where the medical aid or appliance: Item 87 of Schedule 3 (Item 87) lists 'cushions specifically designed for people with disabilities'. The phrase 'cushions specifically designed for people with disabilities' is not defined in the GST Act. Generally, where a word or phrase is not defined, it is usually interpreted in accordance with its ordinary meaning unless it has a special or technical meaning. Where a word or phrase has a special or technical meaning, it is necessary to determine the meaning by reference to the industry to which that word or phrase relates (Herbert Adams Pty Ltd v FCT (1932) 47 CLR 222). For the purposes of Item 87, the ordinary meaning of the phrase 'cushions specifically designed for people with disabilities' is interpreted to mean cushions with a specifically designed character or function that have been made, or adapted, for the purposes of: In this case, the lumbar roll is a cylindrical cushion that has been manufactured from a special supportive foam and designed to assist with the support or positioning of the lower back area of an individual with a disability, in a seated or reclined position. Therefore, the lumbar roll falls within the interpreted meaning of 'cushions specifically designed for people with disabilities' for the purposes of Item 87. The lumbar roll is specifically designed for people with an illness or disability, and is not widely used by people without an illness or disability. Therefore the entity is making a GST-free supply under subsection 38-45(1) of the GST Act when it supplies a lumbar roll.

Legislative references: A New Tax System (Goods and Services Tax) Act 1999 subsection 38-45(1) Schedule 3 Schedule 3 table item 87
Case references: Herbert Adams Pty Ltd v FCT (1932) 47 CLR 222
Subject references: Goods & services tax GST free GST health Section 38-45 - medical aids & appliances