Issue
Does the entity, a car dealer, include goods and services tax (GST) in the 'luxury car tax value' when calculating luxury car tax (LCT) using the formula in subsection 5-15(1) of the A New Tax System (Luxury Car Tax) Act 1999 (LCT Act)?
Decision
Yes, the entity does include GST in the 'luxury car tax value' when calculating LCT using the formula in subsection 5-15(1) of the LCT Act.
Facts
The entity is a car dealer. The entity sells a luxury car. The sale is a taxable supply of a luxury car under section 5-10 of the LCT Act. The entity is registered for GST.
Reasons for Decision
The formula in subsection 5-15(1) of the LCT Act for calculating LCT is: 25/100 * 10/11 * [luxury car tax value - luxury car tax threshold]
Section 5-20 of the LCT Act defines the 'luxury car tax value' of a car. Subsection 5-20(1) of the LCT Act provides that the luxury car tax value is the price of the car excluding: (a) any LCT for that supply; and (b) any other Australian tax, fee or charge, other than GST and customs duty payable on the supply of the car.
'Price' is defined in section 27-1 of the LCT Act as having the same meaning given in section 9-75 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act). Section 9-75 of the GST Act defines price as the amount of consideration received for the supply including the GST payable on the supply.
Although there are some taxes, fees and charges that are excluded from the price by subsection 5-20(1)(b) of the LCT Act, GST is not one of them.
Therefore, the entity does include GST in the 'luxury car tax value' when calculating LCT using the formula in subsection 5-15(1) of the LCT Act.