1 Is the entity making a taxable supply under section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 when it supplies holiday packages to non-resident travel wholesalers?
Yes, the supplies are taxable supplies that are subject to GST. Question 2 Is the entity making a taxable supply under section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 when it receives a commission or a rebate from Australian product suppliers? Answer Yes, the receipt of a commission or rebate is consideration for a taxable supply. This ruling applies for the following periods : Any tax periods ending on or after 25 July 2022
The entity is an 'inbound tour operator' and is registered for GST. The entity arranges travel packages which may include airport transfers, hotel accommodation, car hire, entry into cultural and entertainment venues, meals and other services. The entity negotiates with the Australian product suppliers (eg hotels, restaurants, etc) for the supply of the required holiday package component. The entity supplies the holiday packages to a non-resident travel wholesalers which then on-sells the holiday packages to either foreign suppliers or directly to foreign travellers. All packages are purchased by people overseas, before they have travelled to Australia. The entity acts as principal when it negotiates with Australian product providers and when it supplies the holiday packages to the non-resident wholesaler. On occasion, the entity receives commissions or rebates from the Australian product providers.
A New Tax System (Goods and Services Tax) Act 1999 section 9-5 Question 1 Detailed reasoning Generally, a supply of anything is a taxable supply and subject to GST in accordance with A New Tax System (Goods and Services Tax) Act 1999 (GST Act) if: • the supply is made for consideration (payment); and • the supply is made in the course or furtherance of an enterprise that is carried on by the supplier; and • the supply is connected with the indirect tax zone (Australia); and • the supplier is registered, or required to be registered for GST; and • the supply is neither GST-free, nor input taxed. The entity carries on a business of arranging travel packages as an 'inbound tour operator' and supplies the travel packages to non-resident travel wholesaler