Public Message from South Gippsland Bullion.

Bullion Baron said:
iceblue said:
I wont be posting any quotes from the document supplied by the ATO.
Selling into the retail market should have GST they reckon.
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That is like saying any shares sold to retail investors in parcels smaller than $10,000 should have GST.

Ridiculous.
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Presumably this would also apply to shares because there is always a limited number of shares and a lot of companies issue a very pretty looking prospectus, with loads of cool pictures on nice glossy paper.
 
The ATO has some big TITs (Tax Interpretation Teams) responsible for finding paragraphs within the regulations that support whatever interpretation they desire for a particular ruling.
 
SilverPete said:
Perth Bullion until recently sold their own 1 oz silver rounds. I wonder what happened to those? Were they all sold, or were they pulled until some certainty in GST is reached?
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It would be a pretty irony if the tax rules turned them from a genuine low-premium generic bullion round into some ultra-rare outlaw collector piece :)

The whole thing seems crazy to me - why suddenly turn on this industry after 16 years? If taken to its limit it's going to totally gut sales, resulting in piss-poor tax receipts anyway. An even greater proportion of Australian bullion products will leave or shores and possibly never return...

How many stackers on here will continue to buy rounds/coins/bars where GST applies, knowing that that cost can never be recovered on resale??
 
Chances are this all started because some big fish or enough medium fish (maybe dealers maybe private citizens) have been found to be holding significant bullion and most likely there is a difference of opinion how bullion should be treated for tax purposes.

If the tax rule has never been tested in court, than ATO would push it to the fullest extent. That is until a business entity or a private person challenges ATO's interpretation.

Bearing in mind ATOs sole objective is to collect the maximum amount of tax, its not surprising they will read the act it to their advantage.

ATO doesn't make the rules they just follow it.
 
I interpret it is, a bankrupt government will cannibalise any productive area of the economy for more taxes until it eventually collapses. Not that I am an End of Worlder but, there are serious economic problems globally and government are starved for cash. All governments in history eventually fall apart and before they do, they turn on Gold/Silver. This is a fact that plays out repeatedly throughout history.
 
grinners said:
iceblue said:
ALL Bullion products they said we should be charging GST on.
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Do you have an exact quote for that that you can share yet iceblue? Seems like an extraordinary claim for them to make.
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yes it seems the rulings that were quoted seem to only affect coins

bullion bars bars should be safe and not affected.
 
To summarise the above, for gold, silver or platinum to be in an investment form for the purposes of the GST Act, it must be in a form that:

is capable of being traded on the international bullion market, that is, it must be a bar, wafer or coin;
bears a mark or characteristic accepted as identifying and guaranteeing its fineness and quality; and
is usually traded at a price that is determined by reference to the spot price of the metal it contains.
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Define international bullion market

Last time I checked it was 400oz, 100oz and 1kg bars for gold and 5000oz and 1000oz silver bars for good delivery on the comex?

/runs
 
this all seems very much blown out of proportion here.

I will worry when the perth mint start charging gst n their bullion coins or bars, until then its mostly a big beat up.
 
Hi all .. first time poster here and just lurking around the world of stacking. But I saw this thread and it sucks to see a business get screwed by the Govt, no matter the circumstance, especially as it sounds the business was well respected.

But just an idea .. If the basic problem is that the ATO is being a lot more "strict" in the scope of how they determine whether a precious metal product is GST exempt or not .. And then wanting to charge GST on the whole lot. well..

Would/could it be possible to alter the process, on paper? Or the "workflow" of the transaction. For example. What if you "sold" a customer raw silver bullion, which is completely and appropriately tax exempt. And then, as a service (separate to the material cost), you take that metal and then work it into a minted coin or whatever else it may be. So for a coin, you would maybe charge, a few dollars, or whatever it cost, to produce that final product, turning some cast bullion (GST exempt) into a nice minted coin (otherwise subject to GST). And then you charge GST just on the latter process. Exactly what it is - a service (Assuming you are doing this anyway, making your own line of coins and not reselling those from another mint). Effectively just splitting the coins or whathaveyou across 2 line items on an invoice, or even 2 invoices. This way, there is GST still there, but it's much more insignificant as it's calculated off a fraction of the cost.

It wouldn't really be any different if a customer supplied their own metal, and all you did was work other people's materials that they provided, and you never actually sold them the metal to begin with. You couldn't charge tax for a material your customer supplied to you. There would be no transaction for that to apply tax to. You just invoice for the work you do.

I mean .. if you had your car serviced, you pay GST on the parts and labour, not the value of the car. If a plumber fixes a broken tap, you pay GST on the parts and labour, not the value of your land and house. And so on.

Of course, there could be some BS Govt red tape that would make this unfeasible, so maybe someone can rightfully shoot this idea down, but as said, just an idea.
 
I think Rake has a good point. Coin sellers should only have to charge gst on the value above spot. So if a coin sells for $2 above spot you should only add 10% gst on the $2, which comes to 20c. In this way you're only paying gst on the service of making the coin and not the base metal.
 
And look at it this way. Let's say you went to the extreme and split the business up into two: One sells the raw material, the other does the minting. 2 invoices from 2 companies. You purchase the metal from Company A, they "ship" it to the Company B, (aka pick it up off the shelf), who make the coin. Even if the metal inventory is just in coin form to begin with.

Like, really. This is how those at the top of the financial food chain do things. All your big companies are split up across multiple ABNs and trust accounts and whatnot, and they simply shuffle money and paper and "assets" and everything else under the sun between them. And you look at the real big ones who are funnelling everything through off-shore companies and all (Panama papers anyone?). It's ultimately, exactly how the laws we live under work -- everyone as human beings knows it's all crap, but by the letter of the law, these complex business structures are all above board and legitimate. Thing is, it's not just a case of them getting away with it. It's not even a case of this sort of thing being encouraged. It's a case where, this is EXACTLY how the entire system has been designed. It's just about playing the game. And if these corrupt businesses and governments can do it for themselves, why should anyone else feel bad about doing it? My 2 cents .. or maybe 2 grams.
 
Rake's idea sounds similar to the existing practice of charging GST on the barring fee when a client converts pool allocated to a physical coin or bar.

ABC do this: https://www.abcbullion.com.au/barring-charges

Barring Charges

Barring charges cover the costs of fabricating our ABC Bullion pool allocated metal holdings into a specific bar, coin or tablet, which a client wishes to take possession of.

The barring charges are a very simple calculation. Please see below examples.

Example 1

Assume you have 1 troy ounce of gold bullion in ABC Bullion pool allocated gold holdings, worth AUD $1,500. Assume that at the same time, ABC Bullion is selling a physical 1 troy ounce gold cast bar for AUD $1,530.

In this case, the differential between your holdings, and the physical cast bar itself, is AUD $30.

If you wanted to convert your 1 troy ounce of ABC Bullion pool allocated gold into a 1 ounce ABC Bullion gold cast bar, then the fee you would pay would simply be AUD $30, plus GST.
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Court Jester said:
this all seems very much blown out of proportion here.

I will worry when the perth mint start charging gst n their bullion coins or bars, until then its mostly a big beat up.
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Its sad to hear that a fellow stacker is being hounded by the ATO.......
I wouldn't say its blown out of proportion.......as this appears to have ruined someones lively hood.

What I would say , is that I dont believe we are getting the full picture......but only snippets

There are several big players in Australia, who Im sure have some serious legal representation and would know the legislation.
Otherwise , you would have every bullion dealer closing up shop and moving over seas.....hang on....didnt gold pelican move to the states :) (only joking gp)

Basically.....to simplify matters, maybe the ATO should provide a list of bars and coins that are GST free......yes bars as well
Once again, based on rulings from previous cases.....PAMP bars with certificates should attract gst based on ATO interpretation
 
I wonder if the Perth Mint would consider shedding some light on the matter ..... being state owned

Or maybe even the...Royal Australian Mint, being federal owned

Maybe in a different post......I apologize if this has already been suggested
 
argento said:
I wonder if the Perth Mint would consider shedding some light on the matter ..... being state owned

Or maybe even the...Royal Australian Mint, being federal owned

Maybe in a different post......I apologize if this has already been suggested
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Not sure if they would because their coins, are listed in the Currency Determinations.

The Parliamentary Secretary to the Treasurer, make the determination.

Eg:

https://www.legislation.gov.au/Details/F2015L01216


The only problems Perth had with GST was a few years back when they were placing bullion coins in packaging and collecting GST.

Rarely would you find a bullion coin either normal or "coloured-bullion" in packaged format that doesn't attract GST from Perth when ordering.
 
argento said:
I wonder if the Perth Mint would consider shedding some light on the matter ..... being state owned

Or maybe even the...Royal Australian Mint, being federal owned

Maybe in a different post......I apologize if this has already been suggested
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Or even Bron who may be able to shed some light on this given his time at the Perth Mint.

However, it may be that there is a risk to those in the bullion business if they comment publicly given the ATO is known to use public comments against businesses. This no doubt has a chilling effect on public discourse, and the ATO would obviously prefer to keep their targets scared and fragmented and easier to exploit.
 
The Perth mint (or any other business) will not comment publicly on the tax affairs of another tax payer.
 
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