What is GST, and how does it affect me as a consumer?

In Plain English

GST stands for Goods and Services Tax. It's a 10% tax added to most goods, services and other items sold in Australia. As a consumer, you usually pay this tax as part of the final price when you buy something. However, some items, like certain health goods, are GST-free, meaning you don't pay GST on them.

Detailed Explanation

GST is a broad-based tax of 10% on most goods, services and other items sold in Australia, as outlined in the A New Tax System (Goods and Services Tax) Act 1999.

Here's how it affects you as a consumer:

• Taxable Supplies: Generally, when you purchase a "taxable supply," the price includes GST. Section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 outlines the conditions for a taxable supply.
• GST-free Supplies: Some supplies are "GST-free" under Division 38 of the A New Tax System (Goods and Services Tax) Act 1999, meaning no GST is added to the price. For example, the A New Tax System (Goods and Services Tax) (GST–free Health Goods) Determination 2018 and the A New Tax System (Goods and Services Tax) (GST-free Health Goods) Determination 2022 declare certain health goods like menstrual products, condoms, sunscreens etc. to be GST-free.
• Input Tax Credits: Businesses that are registered for GST can claim "input tax credits" for the GST included in the price of things they buy for their business. This helps to avoid GST being charged multiple times in the production and supply chain.