Private ruling: GST and a refund of overpaid and excess GST
Date of advice: 11 December 2015
Published: February 2016

Ruling: Q1: Does section 38-445 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) apply to the sale of vacant land sold by you? | A1: Yes, section 38-445 of the GST Act does apply to some of the sales of vacant land sold by you. | Q2: To the extent that section 38-445 of the GST Act does not apply to any particular supply can you apply item 4 in the table in subsection 75-10(3) of the GST Act (Item 4) to calculate the margin in relation to the taxable supply of vacant land sold? | A2: No, to the extent that section 38-445 of the GST Act does not apply to a supply, you cannot apply Item 4 to calculate the margin in relation to the taxable supply of vacant land sold. This is because those supplies of vacant land to which section 38-445 of the GST Act does not apply included improvements on the land as at 1 July 2000 precluding the use of Item 4. | Q3: Are you entitled to a refund of overpaid or excess GST, in relation to the supply of vacant land, which arose either from the miscalculation of the margin scheme under subsection 75-10(3) of the GST Act (if any) or GST-free under section 38-445 of the GST Act? | A3: No, on the facts of this case, you are not entitled to a refund of overpaid or excess GST, in relation to the supply of vacant land, which arose either from the miscalculation of the margin scheme under subsection 75-10(3) of the GST Act or the mischaracterisation of the GST-free supply under section 38-445 of the GST Act.

Relevant facts and circumstances: You are registered for goods and services tax (GST) with effect from 1 July 2000 and reports GST in monthly tax periods. As at 1 July 2000, you were the registered owner of several parcels of land. In a specified period you sold xx parcels of land (Ruling Properties) which you state were unimproved as at 1 July 2000 and the date of sale. You provided unexecuted standard contracts (Contracts) which are representative of the contracts for the sale of each of the Ruling Properties for which you applied the margin scheme. The Contracts supplied, contain boxes on the front page which have been ticked to indicate that the sale is a taxable supply (in full) and that the margin scheme will be used in making the taxable supply. Not all of the Contracts for the Ruling Properties adopted the margin scheme and since 1 July 2000 none of the Ruling Properties had already been the subject of a supply that was GST-free under section 38-455 of the GST Act. In relation to the sales price of each of the Ruling Properties you state in your ruling application that they were was sold at market value, GST was not taken into account when setting the price and as such, GST was not passed on. None of the purchasers of the Ruling Properties were registered or required to be registered for GST and at this stage, you have not reimbursed any GST to the purchasers. You treated the sales of the Rulings Properties as taxable supplies and as such, you reported the GST on their sales in the relevant monthly activity statement. For those Ruling Properties where you applied the margin scheme, you calculated the GST payable as 1/11 th of the difference between the sale price and the valuation of the interest in the Ruling Properties as at 1 July 2000 in accordance with item 1 in the table in subsection 75-10(3) of the GST Act (Item 1). Where the Contracts did not stipulate that the margin scheme applied, you calculated the GST payable on the sale as 1/11 th of the sale price. You contend that as you are a 'State' for the purposes of the GST Act, the sales should have been either GST-free under section 38-445 of the GST Act or, if not GST-free, then the margin you calculated when applying the margin scheme should have been calculated under Item 4 rather than Item 1. Some of the Ruling Properties were sold after May 20XX. In support of your claim that there were no improvements on any of the Ruling Properties you sold, you provided aerial photographs and valuations and provided arguments why they were all unimproved and in their natural state. RP data was also used.

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 Section 38-445 | A New Tax System (Goods and Services Tax) Act 1999 Section 75-10 | A New Tax System (Goods and Services Tax) Act 1999 Subsection 75-10(3) | A New Tax System (Goods and Services Tax) Act 1999 Subsection 75-10(3A) | A New Tax System (Goods and Services Tax) Act 1999 Section 142 Schedule 1 to Taxation Administration Act 1953 section 105-65

Reasons for decision: Summary: Based on the available information, the sale of xx of the Ruling Properties come within section 38-445 of the GST Act either because there was no human intervention evident on the land or the human intervention identified did not enhance the value of the land and thus, was not an improvement. As such, the sale of these Ruling Properties are GST-free. However, you are not entitled to a refund of the overpaid or excess GST in relation to these xx Ruling Properties under either section 106-65 of Schedule 1 to the TAA or Division 142 of the GST Act unless you first reimburse the purchaser. This is because we consider that you have passed on the GST to the purchaser and to allow a refund would mean that you would receive a windfall gain as you did not bear the burden of the GST. It should be noted that where section 38-445 of the GST Act applies there is a mischaracterisation of the supply of the Ruling Properties rather than simply a miscalculation of the GST payable. In relation to the remaining xx Ruling Properties, there was no overpaid or excess GST paid by you and therefore, no entitlement to a refund. This is because, from the available information, we consider that there were improvements on the land both as at the time of the supply and as at 1 July 2000. As such, these properties were not GST-free under section 38-445 of the GST Act and you were also not entitled to use Item 4 in applying the margin scheme to these sales. | Detailed Reasoning - Question 1: Subsection 38-445(1) of the GST Act relevantly provides that a supply by the Commonwealth, a State or Territory of land on which there are no improvements is GST-free if the supply is of a freehold interest in the land. However, the supply is not GST-free if, since 1 July 2000, the land has already been the subject of a supply that is GST-free under section 38-455 of the GST Act. On the facts provided, none of the Ruling Properties were the subject of a supply that was GST-free since 1 July 2000. Therefore, the two key issues that arise under subsection 38-445(1) of the GST Act, in the present circumstances, are whether you are considered a 'State' and if so, whether each of the Ruling Properties is land on which there are no improvements at the time you supplied them, which in this case is settlement. With regards to the first requirement, you are a 'State' for the purposes of subsection 38-445(1) of the GST Act. Goods and Services Tax Ruling GSTR 2006/6 considers the meaning of the phrase 'land on which there are no improvements'. Paragraph 20 of GSTR 2006/6 states: Unimproved land is taken to be land in its natural state. Thus, to establish whether there are improvements on the land for the purpose of these provisions, the land is compared with land in its natural state. Paragraph 21 of GSTR 2006/6 refers to the meaning of 'improvements' in the context of land tax which was held by the High Court in Morrison v. Federal Commissioner of Land Tax (1914) 17 CLR 498 at 503 to be: Any operation of man on land which has the effect of enhancing its value comes within the definition of 'improvement'. Following on from this, paragraph 22 of GSTR 2006/6 explains that for there to be 'improvement on the land': • there must have been some human intervention • the human intervention must have been physically located on the land, and • that human intervention must enhance the value of the land at the relevant date for ascertaining whether there are improvements on the land. Paragraph 25 of GSTR 2006/6 sets out examples of human intervention that may enhance the value of land which include: • fencing including internal or boundary fencing • utilities, for example, water, electricity, gas, sewerage connected or available for connection • clearing of timber, scrub or other vegetation, and • drainage of land. While the term 'improvement on the land' is not limited to visible improvements, it should be noted that if any human interventions located on the land enhance its value at the relevant date, then there are improvements on the land. You advised that there were no improvements on any of the Ruling Properties you sold and that they were 'unimproved at both 1 July 2000 and the date of supply to purchasers'. However, from the available information, some of the Ruling Properties showed signs of human intervention when compared to land in its natural state. The aerial photos, RP Data and the valuations describing the properties in question indicate that the following xx Ruling Properties have no evidence of human intervention either as at 1 July 2000 or at the time they were sold by you: As there is no human intervention evident on these properties the requirements of section 38-445 of the GST Act that there is a supply by a State, of land on which there are no improvements at the time of the supply is satisfied. Accordingly, the sale of these xx Ruling Properties are GST-free. On the other hand, the aerial photos, RP data and the valuations indicate the presence of some possible human intervention in respect of the following: Therefore, the issue that arises is whether any of this human intervention has enhanced the value. In some circumstances, human intervention on land neither enhances nor decreases the value of land. For example, a fire break, solely to allow access to fire equipment and reduce the spread of fire, may not enhance the value of the particular land. In other circumstances, human interventions that were once improvements may have over time deteriorated or contributed to land degradation, and as such, may no longer enhance the value of the land and thus, are not improvements. The impact of human intervention was considered in Lewis Kiddle and another v. Deputy Federal Commissioner of Land Tax 27 CLR 316 where at 320 the High Court stated: Presumably, a purchaser of land, if he considered this question at all, would determine that the amount to be attributed to value of improvements would be equal to the amount which he gained or saved by reason of the improvements having been made, he being thereby relieved from the necessity of making them. … As outlined in paragraph 34 of GSTR 2006/6, for the purposes of subsection 38-445(1) of the GST Act the relevant day for ascertaining whether there are improvements on the land is when the supply is made. In the present circumstances, having considered all of the available information, the human intervention identified with the following xx Ruling Properties does not appear to have enhanced their value at the time that they were sold: From the facts, we consider that there no improvements and therefore the requirements of section 38-445(1) of the GST Act are satisfied and the supplies of these properties are also GST-free notwithstanding that they were subject to human intervention. Accordingly, the Ruling Properties identified as having no human intervention together with those Ruling Properties that were subjected to human intervention which did not enhance their value (collectively the unimproved Ruling Properties), are supplies of land on which there are 'no improvements' that come within subsection 38-445(1) of the GST Act and as such, are GST-free. However, the following xx Ruling Properties (referred to collectively as the cleared Ruling Properties) have been subjected to human intervention that we consider enhanced their value: The aerial photos, the RP data and the valuations indicate that these xx Ruling Properties were not in their natural state when compared to surrounding land that was in its natural state. Consequently, the cleared Ruling Properties are not land on which there are no improvements and as such, the sale of these properties are not GST-free under section 38-445 of the GST Act. | Detailed Reasoning - Question 2: As determined above in Question 1, the xx cleared Ruling Properties are not GST-free under section 38-445 of the GST Act and therefore, it is now necessary to consider if it was open to you to have determined the margin in relation to the taxable supplies of these properties in accordance with Item 4, rather than Item 1. The margin for the supply under Item 4 is calculated as the difference between the consideration on the sale and the valuation as at the day on which the taxable supply takes place, rather than as at 1 July 2000 which is applicable to Item 1. Calculating the margin under Item 4 equates to a lesser margin and as such, a lesser amount of GST payable. Under subsection 75-10(3) of the GST Act, there are 3 requirements to applying Item 4: • the supplier is the Commonwealth, a State or a Territory • the supplier has held the interest, unit or lease since before 1 July 2000, and • there were no improvements on the land or premises in question as at 1 July 2000. On the facts provided, there is no issue for the purposes of applying the margin scheme that you are 'a State' or that you held the interest in the cleared Ruling Properties in question since before 1 July 2000. In relation to the third requirement, the discussion in GSTR 2006/6 in respect of the meaning of the phrase 'improvements on the land' is equally relevant where a taxable supply of real property is made under the margin scheme and the margin for the supply is calculated under subsection 75-10(3) of the GST Act. However, unlike subsection 38-445(1) of the GST Act, the relevant day for ascertaining whether there are improvements on the land for the purposes of Item 4 is 1 July 2000. In this case, at the time of their sale, the cleared Ruling Properties showed signs of human intervention that enhanced their value. In our view, based on the aerial photos, RP data and valuations, this human intervention that was evident at the time of sale was also present as at 1 July 2000. Furthermore, for the same reasons as given in Question 1, this human intervention would also have enhanced the value of the land as at 1 July 2000 and as such; the properties were not unimproved land for the purposes of Item 4. Accordingly, contrary to your submissions, it was not open to you to apply Item 4 to determine the margin on which GST was to be calculated in relation to the cleared Ruling Properties. That being the case, there was no overpaid or excess GST in respect of the xx cleared Ruling Properties because there was no error in your calculation of the GST payable as you correctly applied Item 1. | Detailed Reasoning - Question 3: Under the general rules, the Commissioner is required to give a refund or apply that amount in accordance with the running balance account (RBA) provisions in Divisions 3 and 3A of Part IIB of the TAA. However, this requirement to give a refund is also subject to section 105-65 of Schedule 1 to the TAA (now only applicable to tax periods starting before May 20XX) and Division 142 of the GST Act which applies to tax periods starting on or after May 20XX. For refunds or credits relating to tax periods starting before May 20XX, section 105-65 of Schedule 1 to the TAA provides that the Commissioner need not give a refund or credit of overpaid GST if all three of the following conditions are satisfied: • there was an overpayment of GST • a supply was treated as a taxable supply when it was not a taxable supply or it was taxable to a lesser extent, and • the recipient has not been reimbursed a corresponding amount of the overpaid GST and/or the recipient of the supply is registered or required to be registered for GST. These conditions seek to ensure that the supplier does not receive a windfall gain at the expense of the end consumer by retaining in full a GST-inclusive price for a supply on which GST is not payable. Miscellaneous Taxation Ruling MT 2010/1 sets out the Commissioners view on the application of section 105-65 of Schedule 1 to the TAA. In this case, you consider that you are entitled to a refund of overpaid GST because you remitted more GST payable in relation to the sale of the cleared Ruling Properties (settled prior to May 20XX) than you would have had to, had you calculated the GST payable based on a margin determined by applying Item 4 instead of Item 1. As determined above in Question 2, it was not open to you to apply Item 4 to determine the margin on which GST was calculated in relation to the cleared Ruling Properties because there were improvements on the land in question as at 1 July 2000. For section 105-65 of Schedule 1 to the TAA to apply, there must first be an amount of GST taken into account in your assessed net amount which is in excess of what was legally payable on the supplies in the relevant period. On the facts provided, there was no incorrect GST in respect of the cleared Ruling Properties because there was no error in your calculation of the GST payable and therefore, there is no entitlement to a refund. As determined in Question 1, you treated the sales of the unimproved Ruling Properties (settled prior to May 20XX) as taxable supplies on which the margin scheme was applied when those supplies were actually GST-free under section 38-445 of the GST Act. As explained in paragraph 23 of MT 2010/1, section 105-65 of Schedule 1 to the TAA will apply to an overpayment that arises from a supply being wrongly treated as a taxable supply when, for example, the supply should have been treated as GST-free. This contrasts to the situation as outlined in paragraph 25B of MT 2010/1 in which the Commissioner takes the view that section 105-65 of Schedule 1 to the TAA does not apply in cases where the supply is always correctly characterised and treated by the supplier, but an overpayment of GST arises from a mere miscalculation such as, for example, where there is an error in the calculation of the margin under the margin scheme. On the facts disclosed, you remitted to the ATO an amount of GST which was in excess of what was legally payable on the supply of those unimproved Ruling Properties. As such, the first two conditions of section 105-65 of Schedule 1 to the TAA are satisfied (paragraphs 105-65(1)(a) and (b) of Schedule 1 to the TAA). In addition, you have not reimbursed the overpaid GST to the purchasers, who you advise are not registered or required to be registered for GST, as you consider that you absorbed the cost of the GST and did not pass it on to these purchasers. Therefore, as all of the conditions of section 105-65 of Schedule 1 to the TAA are satisfied, the Commissioner need not give you a refund of the overpaid GST or apply the amount under the relevant RBA provisions. However, as outlined in paragraph 27 of MT 2010/1, the use of the words 'need not' in section 105-65 of Schedule 1 to the TAA indicates that the Commissioner may choose to pay a refund in appropriate circumstances, even though the conditions in section 105-65 of Schedule 1 to the TAA are satisfied. The circumstances in which the Commissioner may exercise the discretion to refund are explained in paragraphs 113 to 127 of MT 2010/1. However, as stated in paragraph 118 of MT 2010 '… the supplier needs to demonstrate that its circumstances make it appropriate for the Commissioner to give a refund.' In addition, paragraph 129 of MT 2010/1 states: Generally, the Commissioner will not exercise the discretion in cases where the supplier has not reimbursed the unregistered recipients a corresponding amount of the overpaid GST, unless there are other countervailing reasons for doing so. The guiding principles that the Commissioner will take into account when determining whether to exercise the discretion are explained in paragraph 128 of MT 2010/1. Of relevance to your circumstances, is the guiding principle that the Commissioner must have regard to the subject matter, scope and purpose of section 105-65 of Schedule 1 to the TAA which is explained in paragraph 127 of MT 2010/1 as follows: It is clear from the scope and purpose of section 105-65 that the provision is designed to prevent windfall gains to suppliers and to require the supplier to ensure that any refund ultimately compensates the person or entity who ultimately bore the cost. In relation to a refund of overpaid GST, the potential or otherwise for a windfall gain, the requirement to ensure the refund compensates the person or entity that ultimately bore the cost and the potential to disturb the symmetry envisaged by the GST system, are factors that must be taken into account in relation to the exercise of the discretion. In addition, the Explanatory Memorandum to the Tax Law Amendment (2008 Measures No 3) Bill 2008 (which introduced the current version of section 105-65) states: 2.2 Without the restriction on refund requirement, there is a potential for a windfall gain to arise to businesses that receive the refund of GST but have not borne the incidence of the tax. It follows from the above that before the Commissioner will exercise the discretion to refund it must be determined who has borne the burden of the GST. In other words, has the supplier passed on the GST to the recipients of the supply. In answering this question, the Commissioner will take into consideration the factors outlined by the High Court in paragraphs 9 to 12 of Avon Products Pty Ltd v Commissioner of Taxation (2006) HCA 29 (Avon). It is considered that the guidance provided by the Avon case, albeit in a sales tax context, about who bears the burden of the indirect tax impost applies equally in the GST context given the similarity between the sales tax and GST regimes in that respect. These paragraphs are reproduced below: 9. That sales tax is expected to be passed on depends upon the circumstance that sales of goods occur within an economy geared to making profit. It is the profit-making motive of business which, in the nature of things, generally results in sales tax being passed on. This is because, leaving aside rare cases where sales tax is separately identified and superadded to the invoice price after sale, sales tax can only be passed on indirectly through the price mechanism. In a profit-making structure, businesses will set prices so as to ensure at least that all foreseeable costs are recovered, anything above this being conceptualised as a margin of profit. Because sales tax is levied upon the vendor prior to the ultimate sale by retail in the manner explained by Dixon J in Ellis & Clark, it forms part of the cost structure of doing business. There is nothing extraordinary in the proposition that in the usual course of things sales tax will be passed on. 10. As has been explained, it is for the taxpayer to establish a circumstance out of the ordinary, namely that the amount of the overpayment of sales tax has not been passed on. Where the whole or part of the economic burden of sales tax may have been passed on indirectly through prices, the inquiry in this regard is likely to be complex. The complexity arises because prices may be set with reference to a wide range of factors (including considerations of cost of production, competitive advantage, operational cash flow and customer goodwill). However the starting point must be the seller's pricing policy and practice. 11. In this way, the question is to be approached with reference to the actual conduct of the seller in setting prices based upon its actual knowledge at the relevant time. That knowledge includes the belief that the component of sales tax which later proves to have been an overpayment is a real cost of doing business. Accordingly, it is unsurprising that a seller's intention, whether subjective or objectively ascertained, will generally be to pass the burden of the impost on to the purchaser. Since the onus of proof lies upon the taxpayer, it will be for it to establish that a price which is set so as to ensure that it recovers its cost does not include the economic burden of the sales tax. 12. Additionally, once it is appreciated that it is in the nature of sales tax to be passed on, there is nothing remarkable in the consequence that proof to the contrary will occur comparatively seldom. …. But, given what has been said above, realism requires a recognition that in the ordinary course sales tax will have been passed on. The presumption from the Avon case is that the cost of any GST liability is a foreseeable cost that will be passed on to the recipient as part of the cost recovery and pricing structure of the supplier. It is for this reason that section 105-65 of Schedule 1 to the TAA evinces a stance that ordinarily overpaid GST need not be refunded. However, where a supplier contends that it has borne the cost of the GST, it is the supplier that must prove that the GST has not been passed on to the recipients. In this case, you argue that you sold the Ruling Properties at the going market rate without taking into consideration the GST that may be payable. Having regard to the relevant facts, the subject matter, scope and purpose of section 105-65 of Schedule 1 to the TAA and the principles set out in MT 2010/1 it is reasonable to conclude that the sale price of the unimproved Ruling Properties included a GST component and that this GST component was passed on to the purchasers. As such, the burden of the GST was borne by the purchasers rather than by you. Accordingly, in the circumstances, it is not fair and reasonable for the Commissioner to exercise his discretion under section 105-65 of Schedule 1 to the TAA to allow a refund of the overpaid GST. Division 142 of the GST Act which replaces section 105-65 of Schedule 1 to the TAA applies to tax periods starting on or after May 20XX and therefore, it will apply to your claim for a refund of excess GST in respect of those unimproved Ruling Properties that were settled after May 20XX. Division 142 of the GST Act provides that an entity can self-assess its entitlement to a refund of an amount of 'excess GST' according to objective criteria. Under subsection 142-5(1) of the GST Act 'excess GST' is an amount of GST that has been taken into account in an entity's assessed net amount but is not actually payable. In relation to refunding the excess GST, section 142-10 of the GST Act provides that the excess GST that has been passed on to a recipient is taken to have always been payable and payable on a taxable supply, until the recipient has been reimbursed for the passed-on excess GST. This means that an amount of excess GST will only be refundable if: • it has not been passed on to the recipient, or • it has been passed on to the recipient and the recipient has been reimbursed. It should be noted that, unlike section 105-65 of Schedule 1 to the TAA, Division 142 of the GST Act may apply regardless of how the excess GST arose. For example, excess GST can arise as a result of a mischaracterisation, a miscalculation, or a reporting or administrative error. This is to ensure that excess GST is not refunded if this would give the supplier a windfall gain. Generally, if GST is passed on but there is a refund of the GST to the supplier, the supplier will have a windfall gain unless it reimburses the recipient of the supply. If the excess GST has not been passed on or it has been passed on and the recipient has been reimbursed, section 142-10 of the GST Act does not apply and you may, subject to the period of review, request an amendment to your assessment for the relevant tax period to reduce the amount of GST attributable to the tax period. The Commissioner's view on the meaning of the terms 'passed on' and reimburse' for determining whether section 142-10 of the GST Act applies to an amount of excess GST is explained in Goods and Services Tax Ruling GSTR 2015/1. Of relevance to this case is paragraph 24 of GSTR 2015/1 which provides that it is envisaged that the supplier 'passes on' the GST to the recipient of the supply. That is, there is an expectation that in the context of the GST system excess GST will be passed on to the customer when a supply is treated as a taxable supply. This means that a supplier claiming a refund because it considers that the excess GST has not been passed on, will need to clearly substantiate the grounds on which it claims the refund. In any dispute, the supplier would have the onus of providing that its circumstances are outside the ordinary and that it did not pass on the excess GST. The matters relevant to determining whether GST has been passed on are outlined in paragraph 28 of GSTR 2015/1 and can include the supplier's pricing policy and practice and the documentary evidence relevant to that transaction. This evidence may include a tax invoice, a contract of sale and other correspondence between the parties. In this case you have not reimbursed the recipient so the issue is whether you passed on the excess GST to the purchasers of the unimproved Ruling Properties. If the excess GST has been passed on to the recipient, section 142-10 of the GST Act applies to treat the excess GST as always having been payable, and payable on a taxable supply, until the excess GST has been reimbursed to the recipient. In relation to the supplier's pricing policy and practice, paragraphs 41 and 43 of GSTR 2015/1 state: 41. Where a supplier sets a price with the knowledge or belief that the transaction is subject to GST, including a belief that the GST which later proves to be an overpayment is a real cost of doing business, this will point towards a finding that the excess GST has been passed on. 42. … 43. Similarly, a GST liability calculated under either the margin scheme or the general rules is likely to be a foreseeable cost which forms part of the cost recovery and pricing structure of doing business. On the facts provided, the Contracts show that the supply of the unimproved Ruling Properties are taxable supplies (in full) that included GST and that there was an agreement that the margin scheme was to be used in making the taxable supply. You believe that you have not passed on the GST to the purchasers as you sold the Ruling Properties at the going market rate without taking into consideration the GST that was payable. As stated in paragraph 45 of GSTR 2015/1: A supplier may seek to demonstrate that GST was not considered when setting the price it charged to its customers. This is not, of itself, sufficient to establish that the excess GST has not been passed on. For example, where a supplier is a 'price taker' in a market that primarily makes taxable supplies, this usually indicates that the supplier passed on the excess GST. The fact that the supplier may not have been aware of the GST cost when setting its prices is not enough by itself to demonstrate that GST has not been passed on. In addition, paragraph 115 of GSTR 2015/1 states: Where a supplier is registered for GST and knows of the imposition of GST on what it understands to be taxable supplies, it is likely that the supplier will adopt a pricing policy and structure for the recovery of GST and other costs from the recipient. It is not necessary for the GST to be a separately identifiable component of the price. Also, the facts of this case are analogous to those circumstances set out in example 13 of GSTR 2015/1 (paragraphs 140 to 142). Therefore, having taken the facts of your case into consideration and, in the absence of evidence to the contrary, we consider that you have passed the excess GST on to the purchasers of the unimproved Ruling Properties that were settled after May 20XX. As such, section 142-10 of the GST Act applies to treat the excess GST as always having been payable, and payable on a taxable supply, until the excess GST has been reimbursed to the purchaser.