GST and Involuntary Supplies

Publisher:
Monash University
Publication Type:
Journal Article
Citation:
Journal of Australian Taxation, 2003, 6 (2), pp. 224 - 244
Issue Date:
2003-01
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This article examines the application of GST to involuntary supplies. It does this by analysing the compulsory acquisition of land and the compulsory acquisition of securities. It is clear that the compulsory acquisition of land under statutory mechanisms generally should not involve taxable supplies as the dispossessed landholder is passive in the process. This highlights a key limitation of the concept of a supply. The Commissioner recently has acknowledged this treatment despite expressing a contrary view for more than two years. The GST treatment of the compulsory acquisition of securities is more uncertain. These uncertainties largely arise from whether the limitations of the concept of supply also apply in relation to the definition of financial supply in the A New Tax System (Goods and Services Tax) Regulations 1999.
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