Following action by the Australian Competition and Consumer Commission a West Australian publican will offer refunds to its customers who were incorrectly charged Goods and Services Tax on credit card cash advance transactions.
The ACCC received a complaint from a consumer who said he was charged GST on a credit card cash advance transaction from a tavern in Mandurah, Western Australia during December 2000. The consumer was told by staff at the tavern that GST was payable on the credit card cash advance transaction and subsequently had 10 per cent of the total cash advance withheld as GST.
The ACCC obtained a private ruling from the Australian Taxation Office which stated that a credit card cash advance transaction is not considered a taxable supply and therefore is not subject to GST.
The ACCC believes that representations that GST is payable in circumstances where it is not, is misleading and deceptive and constitutes a breach of the consumer protection provisions of the Trade Practices Act 1974.
In resolving the matter with the ACCC, the tavern has voluntarily agreed to stop the conduct, display a corrective notice, and refund the amount of GST paid by those consumers who can show they were charged GST on a credit card cash advance transaction.
"The ACCC continues to have a major role in ensuring that consumers are not misled as to the effect of the GST", ACCC Chairman, Professor Allan Fels, said today.
"This matter clearly shows that traders must ensure they apply the GST accurately.
"Any consumer who believes they may have been misled about the GST or been incorrectly charged GST can contact the ACCC Infocentre on 1300 302 502".