Private ruling: GST and export of goods
Date of advice: 31 October 2023
Published: 18 December 2023

Ruling: Q1: Will your sale of goods to your customers overseas be GST-free under subsection 38-185(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)? | A1: Yes

Relevant facts and circumstances: You are an Australian entity that is registered for GST. You will buy goods from a manufacturer and sell them to customers overseas. You do not act as agent for the manufacturer or for the overseas customers. You will issue an invoice when an order is placed by the customer, after which the customers will pay. You will export the goods within 60 days after the invoice is issued. You will organise a shipping agent to export the goods from Australia to an overseas destination. You will be named as the shipper on the bill of lading and all other relevant documents.

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 section 38-185

Reasons for decision: Summary: A supply of goods is GST-free under item 1 in the table in subsection 38-190(1) of the GST Act (item 1) if the supplier exports them from Australia before, or within 60 days (or such further period as the Commissioner allows) after: (a) the day on which the supplier receives any of the consideration for the supply; or (b) if, on an earlier day, the supplier gives an invoice for the supply - the day on which the supplier gives the invoice. The question of whether the supplier exports the goods is answered by examining the role the supplier plays in bringing about the removal of the goods from Australia. The supplier is the exporter if the part played by the supplier is sufficient to justify the supplier being described as the sender of the goods out of Australia. Goods and Services Tax Ruling GSTR 2002/6 sets out the Commissioner of Taxation's view on the meaning of 'the supplier exports'. Paragraph 109 of GSTR 2002/6 states: 109. Against this policy background, we consider that the role of the supplier is sufficient to justify describing the supplier as the entity that exports goods from Australia, where: (a) the supplier contracts at the supplier's own expense with an international carrier for the transportation of the goods to a destination outside Australia; or (b) the supplier is responsible for delivering the goods to the operator of a ship or aircraft who, or that, has been engaged by another party to transport those goods to a destination outside Australia. You advised that you will organise a shipping agent to export the goods from Australia to anoverseas destination and that you will be named as the shipper on the bill of lading and all other relevant documents. As such, we consider that your role in removing the goods from Australia indicates that you will export the goods. Furthermore, you will issue an invoice before you receive the payment from the customers and will export the goods within 60 days after the day you issued the invoice. The requirements in item 1 will be satisfied; therefore, your sale of the goods to your customers overseas will be GST-free under subsection 38-185(1) of the GST Act.