Issue
Is the entity, a supplier of medical aids and appliances, making a GST-free supply under subsection 38-45(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it supplies crutches for people with an illness or disability?
Decision
Yes, the entity is making a GST-free supply under subsection 38-45(1) of the GST Act when it supplies crutches for people with an illness or disability.
Facts
The entity is a supplier of medical aids and appliances. The entity supplies crutches which are used to assist people with ambulatory difficulties. The crutches are specifically designed for people with an illness or disability and are not widely used for people without an illness or disability.
There is no agreement between the entity and the recipient that the supply is not to be treated as a GST-free supply.
The entity is registered for goods and services tax (GST).
Reasons for Decision
Under subsection 38-45(1) of the GST Act, the supply of a medical aid or appliance is GST-free where the medical aid or appliance: • is covered by Schedule 3 to the GST Act (Schedule 3), or specified in the A New Tax System (Goods and Services Tax) Regulations 1999 (GST Regulations); and • is specifically designed for people with an illness or disability; and • is not widely used by people without an illness or disability.
Item 96 in the table in Schedule 3 (Item 96) lists 'crutches'. As the entity is supplying crutches, they are supplying a medical aid or appliance that is covered by Schedule 3.
In addition, the crutches are specifically designed for people with an illness or disability and are not widely used by people without an illness or disability. As such, the requirements in subsection 38-45(1) of the GST Act are met.
Therefore, the entity is making a GST-free supply under subsection 38-45(1) of the GST Act when it supplies crutches for people with an illness or disability. [Note: As the entity's supply of the crutches is GST-free, the importation of the crutches is a non-taxable importation as defined in section 13-10 of the GST Act.]