On 11 April 2012 the Commissioner issued GSTR 2001/8A3 – Addendum – Goods and Services tax: apportioning the consideration for a supply that includes taxable and non-taxable parts.  To access the consolidated ruling, click here.

The purpose of the Addendum is to amend the ruling to reflect the reasoning of the Full Federal Court in Commissioner of Taxation v Luxottica Retail Australia Pty Ltd [2011] FCAFC 20 and the Administrative Appeals Tribunal in Re Food Supplier and Commissioner of Taxation [2007] AATA 1550, in respect of the calculation of the value of the taxable part of a mixed supply under s 9-80 of the GST Act.  Referring to Luxottica, the ruling states:

To work out the taxable proportion following the Full Federal Court decision, the value of the taxable part of the supply has to be determined by having regard to the facts and circumstances and taking a practical, common sense approach.  The question to be answered is what is a fair and reasonable measure of the value of the taxable part?

The Addendum also updates the commentary in the ruling on differentiating between mixed and composite supplies by making reference to recent case law.