Public Message from South Gippsland Bullion.

iceblue said:
sammysilver said:
I think its the difference between generic bullion coins, minted in the hundreds of thousands, and collector bullion coins, minted in the thousands or hundreds.
Click to expand...

No. Its about the "Characteristics".
Click to expand...
The tax ruling seems pretty vague for a wide bunch of products - especially yours :( But IMO bullion is bullion and, besides the proofs, yours were just as much bullion as the Perth Mint kookaburras.
 
I think our 'series of dissent' has become the most prophet - sizing series in recent history lol.
 
So it's a case of the manufacturing quality being too good and the production volume being too low?

Call me old fashioned, but that used to be called "quality small business".
 
The Crow said:
11. To be the metal gold, silver or platinum, the item must have the character of the metal rather than the character of a thing made from the metal. Items such as jewellery that happen to be made of gold, silver or platinum are not gold, silver or platinum for the purposes of the definition of precious metal in the GST Act. They no longer have the character of the metal gold, silver or platinum. They have the character of jewellery made from gold, silver or platinum. They are therefore not precious metal for the purposes of the GST Act.

12. A factor that can point to whether something has lost its character as the metal gold, silver or platinum is whether it is traded at a price that is determined by reference to the prevailing spot price for the metal. If something is not usually traded at a price determined by reference to the prevailing spot price of its metal content it is not being traded for its metal value only. This suggests that it does not have the character of the relevant metal. It has another character. An example is proof coins. As noted at paragraph 38, proof coins are traded at a price that reflects the quality of the finish over and above what is necessary to trade the metal value. The price is not determined solely by the metal value of the coin. The price is determined by reference to the spot price and by reference to the quality of the physical characteristics of the coin.F1 The latter indicates that proof coins are not traded for the metal value only and therefore indicates that they do not have the character of the metal, but rather the character of manufactured articles, that is, coins made from the metal. This means that proof coins are not precious metal.
Click to expand...


Not sure where the Tax Office gets its idea of how to make a ruling.

The Perth Mint sell "coloured" bullion coins !

GST isn't collected for these couloured bullion coins, although the coins go through the minting process, and get a secondary treatment know as pad-stamping to colour the coins.

Also see glossary of terms

http://www.perthmint.com.au/mintage_policy.aspx
 
Big A.D. said:
So it's a case of the manufacturing quality being too good and the production volume being too low?

Call me old fashioned, but that used to be called "quality small business".
Click to expand...

While SGB rounds were a topic of consideration, they found all brands from all mints to have similar characteristics.
 
Basically, the ATO is now interpreting the GST ruling on precious metals in a way that results in gold and silver bullion coins as not being gold and silver for the purposes of the GST act, and therefore GST is payable. This has been reinforced in ATO private rulings that rule in favor of the ATO's interpretation.

It is based charactertics of the item, i.e., if the ATO can say the design or mintage plays any role in the purchase decision then it is not considered bullion and GST is payable. That's the gist of it.

Coloured coins, coins with an interesting design, coins from small mints, coins that are purchased because the mintage is limited in advance, coins that attract collectors.... all should be subject to GST according to the recent, strict ATO interpretation.
 
Holdfast said:
The Crow said:
11. To be the metal gold, silver or platinum, the item must have the character of the metal rather than the character of a thing made from the metal. Items such as jewellery that happen to be made of gold, silver or platinum are not gold, silver or platinum for the purposes of the definition of precious metal in the GST Act. They no longer have the character of the metal gold, silver or platinum. They have the character of jewellery made from gold, silver or platinum. They are therefore not precious metal for the purposes of the GST Act.

12. A factor that can point to whether something has lost its character as the metal gold, silver or platinum is whether it is traded at a price that is determined by reference to the prevailing spot price for the metal. If something is not usually traded at a price determined by reference to the prevailing spot price of its metal content it is not being traded for its metal value only. This suggests that it does not have the character of the relevant metal. It has another character. An example is proof coins. As noted at paragraph 38, proof coins are traded at a price that reflects the quality of the finish over and above what is necessary to trade the metal value. The price is not determined solely by the metal value of the coin. The price is determined by reference to the spot price and by reference to the quality of the physical characteristics of the coin.F1 The latter indicates that proof coins are not traded for the metal value only and therefore indicates that they do not have the character of the metal, but rather the character of manufactured articles, that is, coins made from the metal. This means that proof coins are not precious metal.
Click to expand...


Not sure where the Tax Office gets its idea of how to make a ruling.

The Perth Mint sell "coloured" bullion coins !

GST isn't collected for these couloured bullion coins, although the coins go through the minting process, and get a secondary treatment know as pad-stamping to colour the coins.

Also see glossary of terms

http://www.perthmint.com.au/mintage_policy.aspx
Click to expand...

If this is happening "now" then the authorities are probably trying to pick off the small fry as a message for the big guys to get into line.
Much more cost effective than tackling someone who can afford good lawyers, etc.
And the Perth Mint is pseudo-government of some sort aren't they?
 
The Crow said:
If this is happening "now" then the authorities are probably trying to pick off the small fry as a message for the big guys to get into line.

Much more cost effective than tackling someone who can afford good lawyers, etc.
And the Perth Mint is pseudo-government of some sort aren't they?
Click to expand...

Small fry are less likely to have the legal resources to effectively fight the ATO. The ATO rulings then create a precedent that is much harder to overturn later so the big players are more likely to fall into line.
 
SilverPete said:
The Crow said:
If this is happening "now" then the authorities are probably trying to pick off the small fry as a message for the big guys to get into line.

Much more cost effective than tackling someone who can afford good lawyers, etc.
And the Perth Mint is pseudo-government of some sort aren't they?
Click to expand...

Small fry are less likely to have the legal resources to effectively fight the ATO. The ATO rulings then create a precedent that is much harder to overturn later so the big players are more likely to fall into line.
Click to expand...

Start with the sardines then go after the tuna.
 
SilverPete said:
Basically, the ATO is now interpreting the GST ruling on precious metals in a way that results in gold and silver bullion coins as not being gold and silver for the purposes of the GST act, and therefore GST is payable. This has been reinforced in ATO private rulings that rule in favor of the ATO's interpretation.

It is based charactertics of the item, i.e., if the ATO can say the design or mintage plays any role in the purchase decision then it is not considered bullion and GST is payable. That's the gist of it.

Coloured coins, coins with an interesting design, coins from small mints, coins that are purchased because the mintage is limited in advance, coins that attract collectors.... all should be subject to GST according to the recent, strict ATO interpretation.
Click to expand...

Thank you.
 
What implications could this have on people who have physical metals stored in SMSF currently? Not me but thought came to mind.
 
Bullion Baron said:
Sounds like a real crap can of worms being opened here by the ATO.
Click to expand...

I reckon after the GST input credits on scrap thing, the ATO has taken on a bunch of junior staff and told them to go hard on anything that looks like a GST dodge.

They might not even realize that they're going to pwn everyone in the industry from the Perth Mint all the way down.
 
Some other coins are minted in unlimited quantities (in the year of release, same as the Kangaroo), such as the lunar coins that aren't 1oz.

But I wonder how the ruling would treat a 1/2oz, 2oz, 5oz lunar coin which would typically have a lower mintage than the 1oz version, even if the 1oz is the only one with the capped mintage... so GST on the 1oz even thought it has a higher mintage than some of it's unlimited counterparts?

Sounds like a real crap can of worms being opened here by the ATO.[/quote]

Weights, mintage numbers irrelevant, people still 'collect' them in the retail market.
 
Big A.D. said:
Bullion Baron said:
Sounds like a real crap can of worms being opened here by the ATO.
Click to expand...

I reckon after the GST input credits on scrap thing, the ATO has taken on a bunch of junior staff and told them to go hard on anything that looks like a GST dodge.

They might not even realize that they're going to pwn everyone in the industry from the Perth Mint all the way down.
Click to expand...
They'd understand the broader implications. They may have even raised concerns to more senior staff, but this reeks of management and political pressures.
 
Any purchase of physical now risks falling under the umbrella of GST. The important point is that this is not anti-PM, it is anti-private holding of PMs outside of oversight. If the metals are purchased at arms length through a fully auditable pool allocated service then it is fine (I think, at least currently.)
 
SilverPete said:
Any purchase of physical now risks falling under the umbrella of GST. The important point is that this is not anti-PM, it is anti-private holding of PMs outside of oversight. If the metals are purchased at arms length through a fully auditable pool allocated service then it is fine (I think, at least currently.)
Click to expand...


Clearly we looked like we were having too much fun .......

Or we looked like bikies.
Or we looked like terrorists.
 
You must log in or register to reply here.
Back
Top