GST and taxi plate owner that does not provide taxi travel

Is the entity, a taxi plate owner, required to be registered for goods and services tax (GST) under the compulsory registration requirements in subsection 144-5(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it only leases out the taxi plate but does not provide taxi travel?

No, the entity is not required to be registered for GST under the compulsory registration requirements in subsection 144-5(1) of the GST Act, when it only leases out the taxi plate but does not provide taxi travel.

The entity owns taxi plates. The entity provides the taxi plates to a taxi company under a lease agreement. The taxi company attaches the plates to its vehicles.

The entity does not own a taxi or a taxi driver's licence.

Subsection 144-5(1) of the GST Act provides that an entity is required to be registered if, in carrying on its enterprise, it supplies taxi travel.

Subsection 144-5(2) of the GST Act further states that it does not matter whether: • the entity's GST turnover meets the registration turnover threshold; or • in carrying on its enterprise, the entity makes other supplies besides supplies of taxi travel.

Taxi travel is defined in section 195-1 of the GST Act to mean 'travel that involves transporting passengers, by taxi or limousine, for fares.'

The entity is only leasing out the taxi plates, it is not transporting passengers. The leasing out of taxi plates in itself does not constitute the supply of taxi travel for the purposes of subsection 144-5(1) of the GST Act. Further, the entity does not own a taxi or a taxi driver's licence and the taxi company attaches the plates to its vehicles. It is the taxi company that provides the taxi travel.

Therefore, the entity is not required to be registered for GST, under the compulsory registration requirements in subsection 144-5(1) of the GST Act, when it only leases out the taxi plates but does not provide taxi travel. [Note: The entity may be required to be registered under the general registration rules outlined in Division 23 of the GST Act.]