Private ruling: GST and supply of tourist services
Published: July 2014

Ruling: Q1: Is your supply of tourist services to Australian clients GST-free under the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)? | A1: Yes, your supply of tourist services to Australian clients is GST-free under section 38-360 of the GST Act. Section 38-360 of the GST Act provides that a supply is GST-free if the supplier makes the supply in the course of carrying on an enterprise as a travel agent and the supply consists of arranging for the making of a supply, the effective use or enjoyment of which is to take place outside Australia. The term travel agent is not defined in the GST Act. However we consider, as expressed in the fact sheet, GST - travel agents and commissions (which is available at www.ato.gov.au) that a travel agent is not limited to registered travel agents but can cover other tourism enterprises, such as airlines, hotels and professional conference organisers, who arrange domestic and overseas travel on behalf of another person or persons. Your supply of tourist services consists of arranging overseas tour (that is international airfare, overseas accommodation and events) for the Australian customer or business. In this instance, you are making your tourist services in the course of carrying on an enterprise as a travel agent for the purposes of paragraph 38-360(a) of the GST Act. Further the effective use or enjoyment of the arranged supplies would take place outside Australia. Paragraph 38-360(b) of the GST Act is also satisfied. Accordingly, your supply of tourist services to the Australian clients is GST-free under section 38-360 of the GST Act Other information Your contract contains a cancellation policy. Goods and Services Tax Ruling GSTR 2009/3 will be of assistance to you as it provides guidance on cancellation fees for GST purposes.

Relevant facts and circumstances: You are a partnership and are registered for the goods and services tax (GST). Your business is located in Australia. You advised you are supplying tourist services to Australian clients who wish to travel abroad to other countries. The tourist services you supply consist of arranging clients' international airfares, overseas transfers, transports and accommodation when they are overseas. You do not supply any tourist services within Australia to the clients. The Australian customers acquire your tourist services for their own purposes and do not require you to provide your tourist services to another entity in Australia. The customers have to sign a contract which provides the tour rates and conditions for purchasing the tourist services from you. We have received a copy of the contract which the customer has to complete and sign. You have a corporate tour program and businesses can buy this tour package from you to supply to their clients

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 Section 38-360