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 a product that is a sound amplifier for people with hearing difficulties?
Decision
Yes, the entity is making a GST-free supply under subsection 38-45(1) of the GST Act. The product is a 'speech amplification /clarification aid' under Item 14 of Schedule 3 to the GST Act.
Facts
The entity is a supplier of medical aids and appliances. The entity is registered for goods and services tax (GST).
The entity supplies a product that is a sound amplifier for people with hearing difficulties. The product works with a hearing aid and is designed to enable the hearing-impaired person to better listen to what they need to, without the limitation of distance and the noise and distraction of other background noise.
The product is specifically designed and manufactured to benefit a person with a hearing impairment who wears a hearing aid, and is not widely used by people without an illness or disability.
There is no agreement between the entity and the recipient that the supply will not be treated as a GST-free supply.
Reasons for Decision
Under subsection 38-45(1) of the GST Act, the supply of certain medical aids and appliances will be 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 2019 (Regulations) • is specifically designed for people with an illness or disability; and • is not widely used by people without an illness or disability.
Item 14 in the table in Schedule 3 to the GST Act (Item 14) lists 'speech amplification/clarification aids'. A speech amplification/clarification aid is a device that is designed to make a person's voice or sound appear larger and/or clearer and more intelligible.
The entity is supplying a product that is a sound amplifier for people with hearing problems. The product works with a hearing aid and is designed to enable the hearing-impaired person to better listen to what they need to, without the limitation of distance and the noise and distraction of other background noise. As the product makes a person's voice or sound appear clearer and more intelligible, it is a 'speech amplification/clarification aid' under Item 14.
Since the product is specifically designed and manufactured to benefit a person with a hearing impairment who wears a hearing aid, it is specifically designed for people with an illness or disability. Further, it is not widely used by people without an illness or disability. As such, the product satisfies all the requirements in subsection 38-45(1) of the GST Act.
Therefore, the entity is making a GST-free supply under subsection 38-45(1) of the GST Act when it supplies a product that is a sound amplifier for people with hearing difficulties.
Amendment History
Date of Amendment Part Comment 9 April 2019 Throughout Updated A New Tax System (Goods and Services Tax) Regulations 1999 to A New Tax System (Goods and Services Tax) Regulations 2019 .
Date of Amendment | Part | Comment
9 April 2019 | Throughout | Updated A New Tax System (Goods and Services Tax) Regulations 1999 to A New Tax System (Goods and Services Tax) Regulations 2019 .