Issue
Can a wine producer be notified for the purposes of subsection 19-10(1) of the A New Tax System (Wine Equalisation Tax) Act 1999 (WET Act) through a means other than a completed quotation form, that the purchaser of wine intends to make a GST-free supply of the wine?
Decision
Yes. A wine producer can be notified for the purposes of subsection 19-10(1) of the WET Act through a means other than a completed quotation form, that the purchaser of wine intends to make a GST-free supply of the wine.
Facts
A producer sold rebatable wine to a purchaser who provided the producer with a quotation exempting the sale from wine equalisation tax (WET).
In this quotation, the purchaser stated that they did not intend to make a GST-free supply of the wine.
By some means other than the quotation, the purchaser made the producer aware, at or before the time of purchase of the wine, that they (the purchaser) intended to make a GST-free supply of the wine.
Reasons for Decision
Section 19-5 of the WET Act sets out the entitlement of a producer of wine to a producer rebate. Relevantly, subsection 19-5(1) of the WET Act provides: (1) You are entitled to a *producer rebate for *rebatable wine for a *financial year if you are the *producer of the wine and: (a) you are liable to wine tax for a *taxable dealing in the wine during the financial year; or (b) you would have been liable to wine tax for a dealing in the wine during the financial year had the purchaser not *quoted for the sale at or before the time of the sale.
Entitlement to the producer rebate is subject to two exceptions. They are set out in section 19-10 of the WET Act. One of these exceptions, set out in subsection 19-10(1) of the WET Act, provides: (1) You are not entitled to a producer rebate because of paragraph 19-5(1)(b) for a dealing in wine if the purchaser notifies you at or before the time of purchase that the purchaser intends to make a supply of the wine that will be GST-free.
Subsection 19-10(1) of the WET Act does not expressly provide that notification by the purchaser must be in any particular or approved form.
The term 'notify' is defined in the Australian Oxford Dictionary (1999,Oxford University Press, Melbourne) as follows: [I]nform or give notice to (a person). make known; announce or report (a thing).
On the ordinary meaning of the word 'notify' and in the absence of any indication to the contrary, notification may be by any means, including verbally.
The approved form that is used for quoting requires the person completing it to indicate whether they intend to make a GST-free sale of the wine.
Therefore the quotation form normally serves to notify a producer if the purchaser intends to make a GST-free sale of the wine.
However, this is not the only form a notification can take. As explained above, notification may occur via any means including verbally. In this instance, the purchaser has informed the producer, through some means other than the quotation form, that the purchaser intends to make a GST-free supply of the goods. The producer's subsequent actions indicate they were aware that the purchaser intended to make a GST-free sale of the wine.
Therefore, a wine producer can be notified for the purposes of subsection 19-10(1) of the WET Act through a means other than a completed quotation form, that the purchaser of wine intends to make a GST-free supply of the wine.