In a February 2014 decision in Australia Pacific Pty Ltd & Ors v Building and Construction Industry Authority [2014] QMC 004, the Magistrates Court of Qld held that GST on domestic and imported goods used in a coal seam gas project in Qld is a component of the cost of building and construction work. This meant the GST was subject to a building and construction training levy, and long service leave levy and a work health and safety levy under s 66 of the Building and Construction Industry (Portable Long Service Leave) Act 1991 (Qld). GST on the building and construction costs for the purpose of the various levies totalled around id=”mce_marker”.2bn with the result that the first appellant was assessed to pay levies totalling over $85m. The applicants appealed.
The Industrial Court of Qld has now dismissed the applicants’ appeals. The Court said the words of Pt 8 of the above Act “compel the conclusion that there is no reason for the GST component in the costs of building and construction work to be excluded from the amount upon which the levy is imposed”. It said this was the case whether the GST was incurred on acquisition of domestic or imported supplies or materials. The Court held that the applicants had not demonstrated that the Magistrates Court had been in error.
(Australia Pacific LNG Pty Ltd & Ors v Building & Construction Industry (Portable Long Service leave) Authority [2015] ICQ 013, Martin P, 28 April 2015.)
[FJM Note: without having been able to look at the relevant section in this Act, it does seem counter-intuitive, to include in ‘cost’, the GST component, which is ultimately refunded by the ATO. This is why, after all, all income tax figures are net of input tax credits.]
[LTN 80,29/4/15]