Private ruling: Supply of land
Date of advice: 22 September 2025
Published: 10 November 2025
Ruling period: XX September 20XX till 30 September 20XX

Ruling: Q1: Is a supply of land by the entity a supply of land by the Commonwealth, a State or Territory for the purposes of determining GST liability under Subdivision 38-N and Division 75 of the A New Tax System (Goods and Services Tax) Act 1999 (the GST Act)? | A1: Yes, the supply of land by the entity is a supply of land by the State for the purposes of determining GST liability under Subdivision 38-N and Division 75 of the GST Act.

Relevant facts and circumstances: The entity was established under a relevant Act as a body corporate.

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 Subdivision 38-N | A New Tax System (Goods and Services Tax) Act 1999 section 38-445 | A New Tax System (Goods and Services Tax) Act 1999 section 38-450 | A New Tax System (Goods and Services Tax) Act 1999 Division 75 | A New Tax System (Goods and Services Tax) Act 1999 section 75-10

Reasons for decision: Summary: Subdivision 38-N of the GST Act relates to grants of land by governments, specifically detailing when such supplies are GST-free. Division 75 of the GST Act relates to the use of a margin scheme to bring within the GST system taxable supplies of freehold interests in land, of stratum interests and of long-term leases. There are different rules for supplies made by the Commonwealth, a Sate or a Territory. Each of section 38-445, section 38-450 and section 75-10 refer to a supply made by 'the Commonwealth, a State or a Territory'. The term 'Commonwealth, a State or a Territory is not defined in the GST Act. GSTR 2006/5 discusses the meaning of 'the Commonwealth, a State or a Territory' for the purposes of nine provisions of the GST Act, including section 38-445, section 38-450 and section 75-10. Paragraph 8 of GSTR 2005/6 provides that a corporation which is not a 'government entity' as defined in section 195-1 of the GST Act may be 'the Commonwealth, a State or a Territory'. Paragraph 9 of GSTR 2006/5 provides that this issue is to be determined in accordance with principles developed by the High Court of Australia in determining the meaning of 'a State' in section 114 of the Commonwealth of Australia Constitution Act , most recently in SGH Ltd v Commissioner of Taxation [2002] HCA 18. In the SGH Case, Callinan J named several criteria which tended to influence the High Court in discerning the true character of a corporation for the purposes of section 115 of the Constitution. However, although the majority of the court held a similar view to that stated by Callanin J, their collective view was expressed slightly differently. The view held by the majority of the court at paragraph 22 is considered as the more relevant view. This is reproduced below. "[W]hether SGH was "the State" requires demonstration of more than government policy favouring or facilitating the creation of the entity in pursuit of some aspect of the public interest. No doubt it requires consideration of the circumstances and purposes of the entity's creation, but also requires consideration of every feature of the entity which bears upon its relationship with the polity. That is why cases about s114 have focused upon the ownership and management of the entity and the purposes the entity was required to pursue. It is those features which will most often reveal the relationship the entity has with the State, and if it is revealed by examination of them that the entity is wholly owned and controlled by the State concerned, and must act solely in the interests of the State , the conclusion that it is the State... will readily follow." [Emphasis added.] In reaching the decision that SGH was not the State, the majority of the court specifically considered the following factors: • The circumstances of the establishment of SGH; • The ownership and management of SGH; • The presence or absence of corporators and whether SGH could disregard the interests of persons other than the State; and • The objects of SGH and whether SGH was required to advance the interests of the State. In your case: • The entity was established under the Act. Therefore, we consider that the entity continues to be wholly owned and controlled by the State and is acting solely in the interests of the State. As such, the entity is 'the State' for the purposes of the GST Act. Note: Whilst the entity is considered to be the State this ruling does not provide guidance on whether your supplies are GST-free under Division 38-N of the GST Act or your liability for determining the margin scheme under Division 75 of the GST Act.