Private ruling: goods and services tax (GST) and importation of a metal commodity
Published: October 2011
Date scheme commenced: You purchased a metal commodity .

Ruling: Q1: Is GST payable on your importation of the a metal commodity ? | A1: No.

Relevant facts and circumstances: You purchased a metal commodity . You imported the a metal commodity into Australia. You have entered the a metal commodity for home consumption (within the meaning of the Customs Act 1901 ). The a metal commodity is in the form of bars. The a metal commodity carries the required markings describing purity and weight and silver content. The values of the a metal commodity are determined by reference to the spot prices of the metal it contains - silver. The a metal commodity is 99.9 % pure. You are not a dealer in precious metals.

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 subsection 7-1(1) | A New Tax System (Goods and Services Tax) Act 1999 paragraph 9-30(3)(a) | A New Tax System (Goods and Services Tax) Act 1999 subsection 13-5(1) | A New Tax System (Goods and Services Tax) Act 1999 paragraph 13-10(b) | A New Tax System (Goods and Services Tax) Act 1999 section 13-15 | A New Tax System (Goods and Services Tax) Act 1999 section 38-385 | A New Tax System (Goods and Services Tax) Act 1999 section 40-100

Reasons for decision: Summary: GST is not payable on your importation of the a metal commodity , as it is an importation of precious metal. | Detailed Reasoning - Detailed reasoning: In accordance with subsection 7-1(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), GST is payable on taxable importations. In accordance with section 13-15 of the GST Act, you must pay GST payable on any taxable importation that you make. You make a taxable importation where you satisfy the requirements of subsection 13-5(1) of the GST Act, which states: You make a taxable importation if: (a) goods are imported; and (b) you enter the goods for home consumption (within the meaning of the Customs Act 1901 ). However, the importation is not a taxable importation to the extent that it is a *non-taxable importation. (* Denotes a term that is defined in section 195-1 of the GST Act) In your case, goods were imported, that is, a metal commodity . Hence, the requirement of paragraph 13-5(1)(a) of the GST Act was satisfied. You entered these goods for home consumption within the meaning of the Customs Act 1901 . Hence, you satisfied the requirement of paragraph 13-5(1)(b) of the GST Act. However, the importation will not be a taxable importation to the extent that it is a non-taxable importation. In accordance with paragraph 13-10(b) of the GST Act, an importation is a non-taxable importation if it would have been a supply that was GST-free or input taxed if it had been a supply. We shall now determine whether your importation of the a metal commodity would have been a GST-free or input taxed supply if it had been a supply. In accordance with section 38-385 of the GST Act, a supply of precious metal is GST-free it the requirements of that provision are satisfied. Section 38-385 of the GST Act states: A supply of *precious metal is GST-free if: (a) it is the first supply of that precious metal after its refining by, or on behalf of, the supplier; and (b) the entity that refined the precious metal is a *refiner of precious metal; and (c) the *recipient of the supply is a *dealer in precious metal. Section 40-100 of the GST Act states that a supply of precious metal is input taxed. In accordance with paragraph 9-30(3)(a) of the GST Act, a supply that would otherwise be GST-free and input taxed is generally GST-free. Section 195-1 of the GST Act defines precious metals. The definition includes silver (in an investment form) of at least 99.9% fineness. Paragraph 29 of Goods and Services Tax Ruling GSTR 2003/10 summaries what is silver in investment form. It states: To summarise the above, for gold, silver or platinum to be in investment form for the purposes of the GST Act, it must be in a form that: · is capable of being traded on the international bullion market, that is, it be must be a bar, wafer or coin; · bears a mark of characteristic accepted as identifying and guaranteeing its fineness and quality; and · is usually traded at a price that is determined by reference to the spot price of the metal it contains. In your case, you imported a metal commodity . The a metal commodity is in the form of bars. The a metal commodity bears marks or characteristics accepted as identifying and guaranteeing its fineness and quality. The a metal commodity is traded at a price that is determined by reference to the spot price of the metal it contains - silver. Hence, the a metal commodity is silver in investment form. Additionally, the a metal commodity has at least 99.9% fineness. Hence, the a metal commodity is precious metal for the purposes of the GST Act. If your importation of the a metal commodity had instead been a supply, this supply would not have been the first supply of precious metal after its refining by or on behalf of the refiner. Additionally, you are not a dealer in precious metals. Hence, the requirements of paragraphs 38-385(a) and 38-385(c) of the GST Act would not have been satisfied if the importation had instead been a supply. Consequently, if your importation of the a metal commodity had instead been a supply, it would not have been a GST-free supply under section 38-385 of the GST Act, as it would not have satisfied all of the requirements of that provision. If your importation of the a metal commodity had instead been a supply, this supply would have been a supply of precious metal, and therefore, input taxed under section 40-100 of the GST Act. Hence, in accordance with paragraph 13-10(b) of the GST Act, your importation of the a metal commodity is a non-taxable importation. Consequently, your importation of the a metal commodity is not a taxable importation, and therefore, GST is not payable by you on this importation.

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