The Government will amend the GST law to provide greater certainty to charities by ensuring that:
- they can use full absorption costing and pooling of similar supplies to determine whether a supply is GST-free;
- they can project costs to determine whether a supply is GST-free; and
- supplies for no consideration are GST-free supplies.
Mr Dutton said that as many not-for-profit organisations have numerous small branches, allowance is made in the GST legislation for the parent body to treat its branch as a separate entity. Building on this separate GST treatment of non-profit sub-entities, the Government will amend the legislation so that the associate provisions do not apply to supplies made between the non-profit body and its sub-entities, and will ensure that sub-entities can access the same GST concessions that are available to their parent bodies.
These changes are subject to the unanimous agreement of the States and Territories.
For a copy of the Minister's press release, No 2007/125, 14 October 2007, go here