TAXATION RULING NO. ST 2193

ST 2193

SALES TAX : PLASTIC RECORD ALBUM ENVELOPES

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FOI status:

May be releasedFOI number: I 1205630

PREAMBLE

Taxation Ruling No. ST 2075 deals with the sales tax classification of covers for records and record album envelopes. Following the amendments to the Sales Tax (Exemptions and Classifications) Act, effective from 20 September 1985, the classification of record album envelopes has been reconsidered with reference to sub-item 96(1) in the First Schedule and item 13 in the Third Schedule to the Act.

2. Sub-item 96(1), First Schedule exempts from sales tax goods of a kind used to wrap up or secure goods for marketing or delivery, namely, inter alia, wrapping material or bags consisting of paper, netting, flexible film or metallic foil, or any combination of those materials, but not including goods covered by item 13, Third Schedule.

3. Item 13, Third Schedule taxes at the rate of 10%, inter alia, wrapping material or bags consisting wholly or principally of paper, netting, flexible film or metallic foil or any combination of those materials, marketed exclusively or principally for household purposes.

FACTS

4. Three types of record album envelopes have come under notice - a "PVC" type which is made of a stiff heavy plastic, a "plastic" type which is made of a lighter more flexible plastic material and a resealable type which incorporates a snap-lock fastener such as those used on plastic coin bags.

5. The "PVC" type is used principally by stores to protect record albums on display. Some stores include "PVC" envelopes with the sale of the album - others make them available separately for purchase by the public. The lighter flexible plastic record envelope is used principally by record retailers as a protective cover for record albums and is sold with the records. The resealable record album envelopes are put up for sale in packs of 25 covers and sold in the packs to the general public for use by them.

RULING

6. PVC and plastic record album envelopes, other than resealable envelopes, are goods of a kind used to wrap up goods for marketing or delivery. While they are also used to some extent to protect record albums in the home they are not marketed exclusively or principally for household purposes and are not covered by item 13, Third Schedule. They are exempt from sales tax under sub-item 96(1), First Schedule.

7. Resealable record album envelopes are sold to the public for the protection of their record albums. They are considered to be marketed exclusively or principally for household purposes in terms of item 13, Third Schedule and are taxable at the rate of 10% from 20 September 1985.

8. Taxation Ruling No. ST 2075 is modified accordingly.

COMMISSIONER OF TAXATION
8 January 1986

References

ATO references:
NO 85/9128-8

Date of effect:
Immediate

Related Rulings/Determinations:

ST 2075

Subject References:
RECORD ALBUM
ENVELOPES;
CONTAINERS
BAGS

Legislative References:
SALES TAX (EXEMPTIONS AND CLASSIFICATIONS) ACT; ITEM 96, FIRST SCHEDULE;
ITEM 13, THIRD SCHEDULE.