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Australia: New GST rules from July 2022

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The Australian Treasury is proposing to impose reporting obligation on platforms in the sharing and gig economy. If implemented, the operators of electronic marketplaces and platforms will be required to report to the Australian Taxation Office (ATO).

 

 

The regime would apply from 1 July 2022 to transactions relating to:

  • supplies of a taxi travel (as defined in the GST legislation, which includes ridesharing)
  • supplies of short-term accommodation

 

 

Definition of Gig and Sharing Economies for Tax

 

Gig and sharing economies are defined as enabling individuals and businesses to offer their resources on flexible terms. The gig economy involves the individuals offering their time in the form of services, generally on a freelance or part-time basis. The sharing economy involves individuals or groups, renting out assets they own to customers who need them.

 

 

A summary of the various sub-sectors of both economies is set out below:

 

Sector  Gig or sharing  Physical/ digital delivery  Examples 
Ride-sharing Gig Physical Uber; BlaBlaCar; Lyft; Grab; Didi
Short-term accommodation Sharing Physical Airbnb; Booking.com; HomeAway; Flipkey
Delivery services Gig Physical Deliveroo; Just Eat; Eat with Me; Instacart
Household services Gig Physical TaskRabbit; Handy
Professional services Gig Digital Freelancer; Fiverr; Upwork
Click-work Gig Digital Amazon mechanical turk
Finance, including Crowdfunding and PeP lending Sharing Digital Lending Club; Lendico; Bitcoin; Ripple; Funding Circle

 

 

 

The draft legislation is similar to the new tax rules of the EU’s Directive on Administration Cooperation (DAC 7). It covers B2C transactions for: goods, services, gig and sharing economies. DAC 7 marketplace legislation is approved by the EU Council and will apply to digital platforms operating both inside and outside the EU from 1 January 2023.

 

Australia’s Commissioner of Taxation has yet to specify the information required from platform operators to ensure adequate reporting to ATO.

 

 

Source: The Treasury Australia

 

NOTE: The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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