Private ruling: Goods and services tax
Date of advice: 23 February 2026
Published: 20 April 2026

Ruling: Q1: Is the supply of XXX Dressing Products (Products) GST-free pursuant to subsection 38-45(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)? | A1: Yes.

Relevant facts and circumstances: You are registered for GST. The Products are a brand of wound care dressings which are widely used in hospitals, clinics, and other medical environments across Australia. The products are polyurethane-based dressings designed to secure intravenous catheter sites, minimise the risk of infection, and support effective healing while maintaining patient comfort and clinical efficiency. You market the Products to hospitals, medical practitioners and medical kit manufacturers (medical kit manufacturers will buy non-sterilised versions of the Products, repackage them as part of a medical kit and sterilise them at a later stage). You neither market the Products to the public, nor are the Products available for sale in a retail setting such as pharmacies.

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Regulations 2019 subsection 38.45.01(1) | A New Tax System (Goods and Services Tax) Regulations 2019 subsection 38.45.01(2) | A New Tax System (Goods and Services Tax) Act 1999 subsection 38-45(1) | A New Tax System (Goods and Services Tax) Act 1999 subsection 182-10(2) | A New Tax System (Goods and Services Tax) Act 1999 section 182-15

Reasons for decision: Summary: The supply of the XXX Products is a GST-free supply under subsection 38-45(1) of the GST Act. | Detailed Reasoning - Detailed reasoning: Subsection 38-45(1) of the GST Act states that the supply of certain medical aids and appliances is GST-free where the medical aid or appliance: (a) is covered by Schedule 3 to the GST Act (Schedule 3), or specified in the A New Tax System (Goods and Services Tax) Regulations 1999 (GST Regulations), (b) is specifically designed for people with an illness or disability and is not widely used by people without an illness or disability. Section 38-45.01 of the A New Tax System (Goods and Services Tax) Regulations 2019 (GST Regulations) interacts with paragraph 38-45(1)(a) of the GST Act. Item 1 in the table in subsection 38-45.01(1) of the GST Regulations specifies the following five items: (a) alginate; and (b) hydro colloids; and (c) hydro gel; and (d) polyurethane film; and (e) polyurethane foam. These terms are not defined in the GST Act or the GST Regulations. The Macquarie Dictionary online defines polyurethane as follows: • polyurethane noun a class of synthetic materials made from a polymer of urethane; used in foam form as lightweight insulation and packing, but also produced as fibres, coatings, and in a flexible form for diaphragms and seals. The ordinary meaning of this term is very broad. Item 1 in the table in subsection 38-45.01(1) of the GST Regulations lists these items under the category heading of 'Advanced wound care' in column two. However, section 182-15 of the GST Act provides that the second column of Schedule 3, or, in the case of section 38-45.01 of the GST Regulations, the second column of the table in subsection 38-45.01(1), is not operative and can only be considered in interpreting an item in the table for a purpose for which an explanatory section may be considered under subsection 182-10(2) of the GST Act. Subsection 182-10(2) states: Explanatory sections form part of this Act, but they are not operative provisions. In interpreting an operative provision, an explanatory section may only be considered: (a) In determining the purpose or object underlying the provision; or (b) To confirm that the provision's meaning is the ordinary meaning conveyed by its text, taking into account its context in this Act and the purpose or object underlying the provision; or (c) In determining the provision's meaning if the provision is ambiguous or obscure; or (d) In determining the provision's meaning if the ordinary meaning conveyed by its text, taking into account its context in this Act and the purpose or object underlying the provision, leads to a result that is manifestly absurd or is unreasonable. Since the ordinary meanings of the items listed in the item 1 in the table in subsection 38-45.01(1) are so broad, the category heading in of 'Advanced wound care' in column two, whilst not operative, assists in the interpretation of the items listed. We consider that 'Advanced would care' refers to wound care that is beyond the average. The wound care is advanced in its design, and beyond the average, where the product has properties to actively assist wound management and healing. Therefore, not every item that contains alginate, hydro colloids, hydro gel, polyurethane film and polyurethane foam will be covered by the items listed. For alginate, hydro colloids, hydro gel, polyurethane film and polyurethane foam products to be covered by items 1(a) to (e) in the table in subsection 38-45.01(1) in the GST Regulations the product must be a product that is for the care of wounds and that is advanced in its design. In determining if a product is one of the items listed in Schedule 3 or the regulations, it is necessary to consider the essential character of the product. The essential character of the product is determined by looking at what essentially the goods are, not some characteristic that the goods might have. Essential character derives from the basic nature of the goods, though composition, function and other factors necessarily play a part. Products that have the essential character of advanced wound care consisting of alginate, hydro colloids, hydro gel, polyurethane film or polyurethane foam, will be products covered by Section 38-45.01 of the GST Regulations and therefore paragraph 38-45(1)(a) of the GST Act. The Products you supply are the XXX Products. The product information for each item shows that the essential character of the Products is that they are wound-care products incorporating features that are advanced in their design. For example, The Products are an advanced dressing to secure intravenous catheter sites, prevent infection, and support healing while maintaining patient comfort and clinical efficiency. The Products are specifically used by medical practitioners while caring for patients. The Products are distinct from everyday use bandages for minor cuts and abrasions. The table below highlights for each of the 11 products, the ingredients that align to those contained in Item 1 in the table in subsection 38-45.01(1) of the GST Regulations. Accordingly, these products are considered to fall within Item 1 in the table in subsection 38-45.01(1) of the GST Regulations. Therefore, paragraph 38-45(1)(a) of the GST Act is satisfied. For the supply of the products to be GST-free under section 38-45 of the GST Act, the products must also meet the requirements of paragraph 38-45(1)(b) of the GST Act. That is, they must also be: • specifically designed for people with an illness or disability; and • not widely used by people without an illness or disability. Subsection 38-45(1) requires that we examine the specific product being supplied and not a class of products. Therefore, in considering the requirements in paragraph 38-45(1)(b), it is the actual product being supplied that must be specifically designed for a person with an illness or disability and not widely used by a people without an illness or disability. The expression 'illness or disability' is not defined in the GST Act. However, for the purpose of paragraph 38-45(1)(b) of the GST Act, the product needs to be designed for people with an illness or disability. An illness or disability is a personal health condition above the level of minor or trivial involving either: • the impairment of some bodily function or structure; or • an activity limitation resulting from an impairment involving difficulty executing everyday activities. Personal conditions involving either of the above may result from an illness, injury or some other cause, and those conditions may be temporary, permanent, chronic or intermittent in nature. In determining whether a medical aid and appliance is specifically designed for people with an illness or disability reference should be made to the designer's/manufacturer's intention of how the good is to be used and its features. Indicators of the designer's/manufacturer's intention of how the good is to be used include how the good is marketed and the type of retail outlets at which the good can be purchased. It is how it is designed that is the test. Whether a medical aid or appliance is used by people without an illness or disability reference should be made to how the wider community uses the goods. That is, the common purpose for which the goods are purchased. The GST treatment is not determined by reference to the actual use for which an item is being purchased but rather focuses on the purpose for which the wider community purchases these products. The Products are an advanced dressing to secure intravenous catheter sites, prevent infection, and support healing while maintaining patient comfort and clinical efficiency. They are specifically designed for medical environments and for patients with an illness or disability and not for any wider use. The Products are marketed for use by hospitals and medical practitioners in the care of patients. The Products are not for use by the public and cannot be purchased by the public in a retail setting. For these reasons, we consider that the Products meet the requirements in paragraph 38-45(1)(b) of the GST Act. As the supply of the Products meets all the requirements of subsection 38-45(1) of the GST Act the supply of the Products is GST-free.