The ATO on Fri 15.11.2013, released an Interim Decision Impact Statement on the Full Federal Court’s decision in AP Group Ltd v FCT [2013] FCAFC 105.
The taxpayer had argued before the AAT that it had overpaid GST on the receipt of 5 categories of incentive payments. The AAT agreed with the taxpayer in respect of 3 categories of payments being “transit allowances”, “retail target incentives” and “wholesale target incentives”. The AAT, however, disagreed with the taxpayer on “fleet rebates” and “run-out model support payments”. The Full Federal Court upheld the AAT’s decision, resulting in a partial win for the motor dealers and partial win for the ATO. The car manufacturers involved were Toyota, Ford and Subaru.
Broadly, the ATO said its preliminary views are as follows:
- other motor vehicle incentive payments – the Commissioner is giving further consideration on how the decision applies to other motor vehicle incentive payments as the AP Group case was only about certain types of incentive payments;
- tripartite arrangements – the Commissioner considers that whether a set of actions gives rise to supplies to more than one party is fact and circumstance dependant;
- wholesale motor vehicle holdback payments – the Commissioner considers that the decision supports the view in GST Determination GSTD 2005/4 that whole sale motor vehicle holdback payments are not consideration for supplies;
- retail motor vehicle holdback payments – the Commissioner considers that such payments are essentially about maintaining the dealer’s profit margin therefore, the existing view will be maintained (ie the view in GSTD 2005/4).
In addition, the ATO said ATO ID 2008/166 (GST and motor vehicle industry incentive payments: fleet sales support – margin support – discretionary payments) has been withdrawn. It said it will also review existing precedential documents and determine if any changes are required.
Comments are due by 10 January 2014. ATO contact – Rajitha Srikhanta – Tel: (03) 9285 1016; Fax: (03) 9285 1943; Email: Rajitha.Srikhanta@ato.gov.au.
[LTN 222, 15/11/13]