The Government has successfully passed legislation to combat GST fraud in the gold trading industry.
The passage of the Treasury Laws Amendment (GST Integrity) Bill 2017 prevents entities from exploiting loopholes in the GST law or committing fraud to avoid remitting GST where it is owed or claiming input tax credits where no GST has been paid.
Under the new law, entities buying gold, silver and platinum products that attract GST must pay the GST directly to the ATO instead of paying it to the seller to remit later to the ATO. This prevents sellers of precious metals from phoenixing without remitting the GST owed.
The legislation also clarifies that precious metals are not second-hand goods. This ensures that businesses cannot claim GST credits on the purchase of precious metals which are altered to be treated as second-hand goods.
To ensure this activity does not simply shift from gold to other metals, the amendments also apply to goods containing silver and platinum.
Guidance on the application of these new measures and other materials related to the changes can be found on the ATO website.
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