Yesterday the Commissioner published two GST rulings, GSTR 2014/2 ‘Goods and services tax: treatment of ATM service fees, credit card surcharges and debit card surcharges’ and GSTR 2014/3 ‘Goods and services tax: the GST implications of transactions involving bitcoin’
The ruling explains the Commissioner’s view on the GST treatment of the following fees and surcharges:
- a fee payable for ATM services listed in subregulation 40-5.09(4A) of the GST Regulations
- a surcharge imposed on a customer in respect of a credit card transaction concerning supplies of goods or services by the merchant to the customer
- a surcharge imposed on a customer in respect of a credit card transaction concerning the payment of an Australian tax or an Australian fee or charge subject to Division 81
- a surcharge imposed by a merchant in respect of a debt card transaction concerning the supply of goods or services, a cash withdrawal or both a supply of goods or services and a cash withdrawal
The ruling explains the Commissioner’s view on the GST consequences of transactions involving the use of bitcoin, in particular whether bitcoin may involve “money” and whether it is a financial supply.
The Commissioner’s view is as follows:
- a transfer of bitcoin from one entity to another is a “supply” and the exclusion of the supply of money from the definition of supply does not apply because bitcoin is not ‘money’ for the purposes of the GST Act.
- a supply of bitcoin is not a financial supply under s 40-5 and it is not a financial supply under paragraph 9-30(2)(b) – it is a taxable supply if the other requirements in s 9-5 are met.
- A supply of bitcoin may be GST-free, e.g. as a supply to a non-resident for use outside Australia.
- A supply of bitcoin in exchange for goods and services will be treated as a barter transaction.
- A supply of bitcoin is not a voucher under Division 100.