Private ruling: Goods and services tax - Health - Medical aids and appliances
Published: September 2014

Ruling: Q1: Will your supply of the medical system be a taxable supply? | A1: No, it will be GST free pursuant to section 38-45 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act).

Relevant facts and circumstances: You are a supplier of a medical appliance within Australia. You are registered for GST. The system is designed to administer a drug. It is designed specifically for people with an illness or disability and not widely used by people without an illness or disability. It is specifically designed for patients that have a fear of needles. There is no agreement between the entity and the recipient that the supply will not be treated as a GST-free supply.

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 38-45, | A New Tax System (Goods and Services Tax) Act 1999 Schedule 3 and | A New Tax System (Goods and Services Tax) Regulations 1999 Schedule 3 table item 12 and 13.

Reasons for decision: Summary: Under subsection 38-45(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), the supply of a medical aid or appliance is GST-free where the medical aid or appliance: • is covered by Schedule 3 to the GST Act , or specified in Schedule 3 of the GST Regulations (Schedule 3), • is specifically designed for people with an illness or disability, and • is not widely used by people without an illness or disability. We accept that your product is specifically designed for people with an illness or disability and not widely used by people without an illness or disability. Item 12 in Schedule 3 of the GST Regulations (item 12) provides for a category called Infusion systems for the delivery of a measured dose of a medication. Item 12 lists infusion sets as a medical aid and appliance.The purpose of an infusion set is to deliver medicine under the skin. Item 13 in Schedule 3 to the GST Regulations (item 13) relevantly lists infusion pumps. An infusion pump is a pump that is used in association with an infusion set to deliver a measured dose of medication. The system is designed to deliver a specified dose to a patient. It contains a plunger that pumps the medicine into the patient in a single movement. As such, the system comprises an infusion pump that is covered by item 13 with an associated infusion set covered by item 12. In addition, the system is specifically designed for people with an illness or disability and 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 the system.