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The Vouchers Problem: and Insoluble Conflict or an Illustration of the Nature of Consideration in the 'Complex Parallel Universe' of GST?


This paper examines the Australian GST treatment of vouchers, focussing on the difficulties that arise in trying to determine the taxable value of supplies made when vouchers are redeemed. It proposes a set of basic GST principles, discusses the way in which Australian GST attempts to embody those principles, and then evaluates the treatment of vouchers by reference to those principles. In the process, it critically examines the Commissioner's draft views on the vouchers regime in Division 100 and proposes an alternative interpretation. Having done so, the paper evaluates both interpretations by reference to one simple and four more complicated voucher transactions, including the supply and redemption of telephone cards, 'free' vouchers, retail loyalty scheme vouchers, and vouchers accepted by a supplier other than the one that issued them. Having concluded that there are insoluble difficulties with the current regime in Division 100, the paper calls for legislative amendment of the GST Act.

Author profile:

Rebecca MILLAR
Rebecca is a Senior Lecturer at the Faculty of Law, University of Sydney. Her areas of interest include GST, Comparative VAT, and the R&D concession. As well as her academic work, Rebecca is a member of the ATO Indirect Taxes Rulings Panel and a consultant to the International Monetary Fund and Michael Johnson & Associates, a Sydney consultancy specialising in Government support for research and innovation. In her work for the IMF, Rebecca has been responsible for drafting VAT and excise tax laws for developing nations, and has also participated in IMF missions advising Governments on the VAT treatment of new residential property and financial services. Before joining the University, Rebecca worked in the GST and Transaction Taxes group at Ernst & Young from 1999 to 2002 and with Michael Johnson and Associates from 1992 to 1999.
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