ATO ID 2013/55: Revocation of approval for making deferred payments of GST
Date of decision: 16 October 2013
Business line: Indirect Tax

Issue
Will an entity's approval for making deferred payments of GST be revoked under subparagraph 33-15.08(1)(c) of the A New Tax System (Goods and Services Tax) Regulations 1999 (the GST Regulations), if the entity applies to adjust previously declared customs values, by lodging a refund application form with Australian Customs and Border Protection Service (ACBPS) manually instead of by computer?

Decision
No, the entity's approval for making deferred payments of GST will not be revoked under subparagraph 33-15.08(1)(c) of the GST Regulations. The refund application containing the amendment to the original import declaration is not considered to be an entry of goods for home consumption within the meaning of the Customs Act 1901 (the Customs Act) and the GST Regulations. As such an application for a refund will have no material effect on the deferred GST status of the entity; regardless of whether they lodge their refund application by computer or manually.

Facts
An Australian entity imports into Australia a broad range of goods and is registered for the Deferred GST Scheme under Division 33 of the GST Regulations. For the relevant importation of goods the entity had communicated with ACBPS in accordance with sections 68 and 71A of the Customs Act and submitted their import declarations electronically via the ACBPS Integrated Cargo System (ICS). The relevant goods were dealt with in accordance with the entry and thereby entered into home consumption. After the goods were entered for home consumption the entity lodged refund application forms manually with ACBPS to adjust previously declared customs values due to transfer pricing adjustments for each affected import declaration. The reduction in customs value also reduces the GST payable on each taxable importation. The entity did not amend the import declaration by computer through the ICS.

Reasons for decision
Summary: The Commissioner may, in writing, revoke an entity's approval for making deferred GST payments under paragraph 33-15.08(1)(c) of the GST Regulations if the Commissioner is satisfied that the entity has failed to meet a requirement in subregulation 33-15.06(1) of the GST Regulations. Under subregulation 33-15.06(1) of the GST Regulations, an approved entity must: Under the facts in this situation the Commissioner considers that paragraph 33-15.06(1)(a) of the GST Regulations continues to be satisfied. In analysing paragraph 33-15.06(1)(a) of the GST Regulations, the meaning of entering goods for home consumption is drawn from the Customs Act. | Detailed Reasoning - Entry of goods for home consumption: An entry of goods for home consumption is made by communicating to ACBPS an import declaration in respect of the goods under subsection 68(3A) of the Customs Act. An import declaration can be communicated by document or electronically under subsection 71A(2) of the Customs Act The entity has communicated with Customs in accordance with sections 68 and 71A of the Customs Act and their communication to Customs was via an import declarations submitted electronically via the ICS. Subsection 71F(2) of the Customs Act provides that alteration of an entry done after an import declaration (entry) is made to ACBPS and before the goods are dealt with in accordance with the entry would constitute a withdrawal. As such any new entry would be regarded as a new entry for home consumption and would be required to be lodged by computer if the importer was registered under the Deferred GST Scheme. This provision is not relevant in the current set of circumstances as the entity's goods have already been dealt with in accordance with the original entry. Subsection 71G(1) shows that unless the original import declaration is withdrawn, a new declaration cannot be made. Also under section 71J of the Customs Act that acceptance by ACBPS of an application for a refund of duty paid is not taken to constitute a withdrawal of the entry for the purposes of the Customs Act. The refund application containing the amendment (adjusting the price as per the transfer-pricing revaluation) to the original import declaration lodged with ACBPS will not constitute a withdrawal of the original entry if ACBPS accepts that refund request. The refund application is not considered to be an entry for home consumption within the meaning of the Customs Act. As such, there is no requirement for the entity to submit the refund application to ACBPS electronically to satisfy paragraph 33-15.06(1)(a) of the GST Regulations. Accordingly, the entity is not in breach of paragraph 33-15.08(1)(c) of the GST Regulations when it lodges the refund application to adjust previously declared customs values as they have not failed to meet a requirement in subregulation 33-15.06(1) of the GST Regulations. The Commissioner would not consider revoking the entity's approval of deferred GST payments.

Legislative references: A New Tax System (Goods and Services Tax) Regulations 1999 subregulation 33-15.06(1) paragraph 33-15.06(1)(a) subregulation 33-15.08(1) paragraph 33-15.08(1)(c)
Related public rulings and determinations: GSTR 2003/15
Subject references: goods and services tax deferred GST Scheme GST Imports GST import of goods GST supply GST supplies & acquisitions