Senator O'Brien asked the Minister representing the Treasurer, upon notice, on 2 March 1999:

(1) Will horse racing jockey's and trotting driver's fees attract the Government's proposed Goods and Services Tax (GST).

(2) If there are any exemptions: (a) what are they; and (b) what is the basis for these exemptions.

(3) Will horse and greyhound trainer's fees attract the Government's proposed GST.

(4) If there are any exemptions: (a) what are they; and (b) what is the basis for these exemptions.

(5) Will all veterinary fees associated with the racing of horses or greyhounds attract the Government's proposed GST.

(6) If there are any exemptions: (a) what are they; and (b) what is the basis for these exemptions.

Senator Kemp (Assistant Treasurer) —The Treasurer has provided the following answer to the honourable senator's question:

(1) Entities that are registered for GST purposes will be required to charge GST on their activities and will be able to claim input tax credits for the GST paid on purchases of business inputs. Businesses carrying on an enterprise with a turnover of $50 000 or more will be required to register for GST purposes, while those with a turnover less than $50 000 will have the option to register. Where a jockey or trotting driver is an employee, their salary will not be subject to GST but, subject to the registration threshold, the fee charged by their employer for their services will. However, horse or greyhound owners registered for GST purposes will be able to claim input tax credits to offset the GST paid on business purchases, including horse racing jockey's and trotting driver's fees where these services are purchased from a registered business.

(2) GST free treatment exists for certain activities such as health and education services. Chapter 3 of the A New Tax System (Goods and Services Tax) Bill 1998 outlines the activities that qualify for GST-free treatment.

(3) Entities that are registered for GST purposes will be required to charge GST on their activities and will be able to claim input tax credits for the GST paid on purchases of business inputs. Businesses carrying on an enterprise with a turnover of $50 000 or more will be required to register for GST purposes, while those with a turnover less than $50 000 will have the option to register. However, horse or greyhound owners registered for GST purposes will be able to claim input tax credits to offset the GST paid on business purchases, including horse and greyhound trainer's fees where these services are purchased from a registered business.

(4) See (2).

(5) Where the veterinary surgeon is registered for GST purposes, GST will be charged. However, horse or greyhound owners registered for GST purposes will be able to claim input tax credits for the GST paid on business purchases.

(6) See (2).