GST and Supply of patient records under a subpoena

Is the entity, a medical practitioner, making a taxable supply under section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it provides patient records in accordance with a subpoena?

Yes, the entity is making a taxable supply under section 9-5 of the GST Act when it provides patient records in accordance with a subpoena.

The entity is a medical practitioner (as defined in section 195-1 of the GST Act). The entity provides patient records, in accordance with a subpoena. The entity is not a party to the litigation. It provides the patient records in its capacity as an expert witness. The entity does not attend court during the proceedings.

The entity is neither an 'Australian government agency' (as defined in section 195-1 of the GST Act) nor an employee of an Australian government agency.

The entity receives a monetary fee (known as 'production money') for providing the patient's records. There is no medicare benefit payable for the service that the entity is providing.

The entity is registered for goods and services tax (GST). The entity is making the supply of patient records in Australia.

Under section 9-5 of the GST Act, an entity is making a taxable supply if: (a) the entity makes the supply for consideration; and (b) the supply is made in the course or furtherance of any enterprise that the entity carries on; and (c) the supply is connected with Australia; and (d) the entity is registered, or required to be registered for GST. In this case, the supply takes place in Australia and is therefore connected with Australia (as per paragraph 9-5(c) of the GST Act). Furthermore, as the entity is registered for GST (as per paragraph 9-5(d) of the GST Act), the question at issue is whether the supply by the entity is made for consideration and is in the course or furtherance of the entity's enterprise (as per paragraphs 9-5(a) and 9-5(b) of the GST Act).

It is considered that where an entity is required to produce documents or give evidence that relates to an enterprise that it conducts, the production of those documents or the giving of evidence will also be in the course or furtherance of the enterprise. In the practice of medicine, this commonly occurs in two situations. An entity may be required to produce medical records of treatment provided to a patient; or it may be required to give expert medical evidence. Generally, payments for or connected with that supply, including payments of 'production money', will be consideration for that supply.

However, under the A New Tax System (Goods and Services Tax) (Exempt Taxes, Fees and Charges) Determination 2000 made pursuant to Division 81 of the GST Act, some payments to professional or expert witnesses for evidence supplied in accordance with a subpoena will not be 'consideration' (as per paragraph 9-5(a) of the GST Act), where the professional or expert witness is an Australian government agency (as defined in section 195-1 of the GST Act).

In this case, this exception does not apply because the entity is not an Australian government agency. Therefore, as the entity is making a supply for consideration in the course or furtherance of its enterprise as a medical practitioner, when it provides patient records to a court in accordance with a subpoena; the supply meets the positive limbs of section 9-5 of the GST Act.

However, the negative limb of section 9-5 of the GST Act provides that a supply is not a taxable supply to the extent that it is GST-free or input taxed. Of most relevance to this case is section 38-7 of the GST Act, which provides that a supply of a 'medical service' is GST-free. 'Medical service' is defined in section 195-1 of the GST Act to mean: • a service for which medicare benefit is payable under Part II of the Health Insurance Act 1973 ; or • any other service supplied by or on behalf of a medical practitioner or approved pathology practitioner that is generally accepted in the medical profession as being necessary for the appropriate treatment of the recipient of the supply.

In this case, there is no medicare benefit payable for the supply made by the entity. Therefore, the question at issue is whether the entity is making a supply that is generally accepted in the medical profession as being necessary for the appropriate treatment of the recipient of the supply, as per the second limb of the definition of medical service in section 195-1 of the GST Act.

Section 195-1 of the GST Act defines 'recipient', in relation to a supply, as the entity to which the supply is made. In this case, the recipient of the supply is not the patient of the medical practitioner but rather a third party (i.e., the party that requested the subpoena).

'Appropriate treatment' of a recipient is not defined in the GST Act. However, it is considered that appropriate treatment will be established where a practitioner assesses the recipient's state of health and determines a process to pursue in an attempt to preserve, restore or improve the physical or psychological wellbeing of the recipient.

Accordingly, when the entity provides patient records to a court in accordance with a subpoena, the entity is not supplying appropriate treatment to the recipient of the supply. As such, the entity is not making a GST-free supply under section 38-7 of the GST Act.

In this case, the entity is registered for GST and the supply satisfies the other positive limbs of section 9-5 of the GST Act. Furthermore, as the supply is neither GST-free under Division 38 of the GST Act nor input taxed under Division 40 of the GST Act; the entity is making a taxable supply under section 9-5 of the GST Act.