Saga Holidays Limited v Commissioner of Taxation [2006] FCAFC 191

Saga Holidays Limited v Commissioner of Taxation [2006] FCAFC 191

The packaged tour contract between Saga and the tourist created a contractual right for the tourist to receive accommodation in Australia, which is a 'contractual right exercisable over or in relation to land' under s 195-1(c) of the GST Act. This constitutes a supply of real property for GST purposes. As the land is in Australia, the supply is connected with Australia under s 9-25(4). The accommodation component is not merely incidental to the tour and must be treated as a separate supply connected with Australia and subject to GST. The appeal and cross-appeal were both dismissed.

Jurisdiction
Australia
Judgment Date
20 December 2006
Procedural Posture
Appeal / Full Court on Appeal From a Single Judge of the Federal Court
Outcome
Appeal and cross-appeal dismissed
Legal Topics
['goods and Services Tax (gst)' 'taxable Supply' 'statutory Construction' 'cross Border Transactions' 'real Property Definition Under Gst' 'incidental Supply Under S 96 5' 'executory Contracts and GST Liability']
['taxation' 'administrative Law'] ['goods and Services Tax (gst)' 'taxable Supply' 'statutory Construction' 'cross Border Transactions' 'real Property Definition Under Gst' 'incidental Supply Under S 96 5' 'executory Contracts and GST Liability']

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Procedural Posture

Appeal / Full Court on Appeal From a Single Judge of the Federal Court

Legal Issues

  1. 1 ["Whether the supply by Saga Holidays Limited to non-resident tourists of the accommodation component of a packaged Australian tour is a supply of 'real property' within s 195-1 of the GST Act" "Whether the supply is 'connected with Australia' within s 9-5 of the Act" 'Whether the accommodation component is incidental to other components of the tour for the purposes of s 96-5(4)' 'Whether services and facilities associated with accommodation are part of the supply of real property']

Ratio Decidendi

The packaged tour contract between Saga and the tourist created a contractual right for the tourist to receive accommodation in Australia, which is a 'contractual right exercisable over or in relation to land' under s 195-1(c) of the GST Act. This constitutes a supply of real property for GST purposes. As the land is in Australia, the supply is connected with Australia under s 9-25(4). The accommodation component is not merely incidental to the tour and must be treated as a separate supply connected with Australia and subject to GST. The appeal and cross-appeal were both dismissed.

Court Disposition

Appeal and cross-appeal dismissed

Orders

  • ['The appeal be dismissed.' "The appellant pay the respondent's costs of the appeal." 'The cross-appeal be dismissed.' "The cross-appellant pay the cross-respondent's costs of the cross-appeal."]