Private ruling: GST and fees and charges
Date of advice: 16 September 2019
Published: December 2019

Ruling: Q1: Is the payment of the fees to you treated as not being the provision of consideration under Division 81 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)? | A1: No, the payment of the fees is not treated as not being the provision of consideration under Division 81 of the GST Act. The payment of the fees is consideration for a taxable supply under section 9-5 of the GST Act.

Relevant facts and circumstances: You are a government agency in Australia. You have provided relevant information about your operations. You charge the relevant fees under the relevant Australian law.

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 Section 9-5 | A New Tax System (Goods and Services Tax) Act 1999 Subsection 81-10(1) | A New Tax System (Goods and Services Tax) Act 1999 Subsection 81-10(2)

Reasons for decision: Summary: All legislative references in this ruling are to the GST Act unless otherwise stated. Division 81 deals with the payment of taxes, fees and charges to an Australian government agency. GST does not apply to payments of taxes, fees and charges that are excluded from the GST by Division 81 or by the A New Tax System (Goods and Services Tax) Regulations 2019 (GST Regulations). Goods and services tax (GST) applies to certain taxes, fees and charges prescribed by the GST Regulations. Australian fee or charge is defined in section 195-1 to mean a fee or charge (however described), other than an Australian tax, imposed under an Australian law and payable to an Australian government agency. Therefore, for the annual licence fees and assignment fees to not be consideration for a supply, they must be: (1) imposed under an Australian law (2) payable to an Australian government agency, and (3) covered by subsection 81-10(4) or of a kind prescribed by the GST Regulations. 1) Are the fees imposed under an Australian law? The fees are imposed by the CLR Act. Therefore, they are fees and charges imposed under an Australian law. 2) Are the fees payable to an 'Australian government agency'? Australian government agency is defined in section 195-1 to have the meaning given by section 995-1 of the ITAA 1997. Australian government agency means: (a) the Commonwealth, a State or a Territory, or (b) an authority of the Commonwealth, a State or a Territory. The fees are payable to you. You are an Australian government agency. Therefore, for the purposes of this ruling, the fees are payable to an Australian government agency. 3) Are the fees covered by subsection 81-10(4) or of a kind prescribed by the GST Regulations? Under subsection 81-10(1), a payment or the discharging of a liability to make a payment, is not the provision of consideration if an Australian fee or charge is of a kind covered by subsection 81-10(4). Subsection 81-10(4) covers a fee or charge if it relates to, or relates to an application for, the provision, retention, or amendment, under an Australian law, of a permission, exemption, authority or licence (however described). However, subsection 81-10(2) provides a payment or the discharging of a liability to make a payment is treated as the provision of consideration to the extent the payment is an Australian fee or charge that is, or is of a kind, prescribed by the GST Regulations. To ascertain if the fees are not to be treated as consideration for the supply, we have to consider if subsection 81-10(2) applies by considering the relevant requirements and the GST Regulations. Section 81-10.01 of the GST Regulations lists the prescribed kinds of Australian fees and charges that constitute consideration. In this regard, it is considered the fees are covered under the following paragraphs of the GST Regulations: · 81-10.01(1)(c) where it provides that a fee for hire, use of, or entry to a facility, except for an entry fee to a national park, and · 81-10.01(1)(g) of the GST Regulations, where it prescribes a fee or charge for a supply of a non-regulatory nature as constituting consideration. Does section 81-15 apply? Section 81-15 provides that the GST Regulations may provide that the payment of a prescribed Australian fee or charge, or of an Australian fee or charge of a prescribed kind, or the discharging of a liability to make such a payment, is not the provision of consideration. There are no Australian fees or charges prescribed or of a prescribed kind that apply in your case. Conclusion: Therefore, as the fees paid to you are of a kind prescribed by the GST Regulations as constituting consideration for the purposes of subsection 81-10(2), they are consideration for a taxable supply as the supply meets all of the requirements of section 9-5.