GST core
Price display
Price display covers how businesses show prices to customers, and for consumers the displayed price generally has to be a single, GST-inclusive total rather than an exclusive price plus extras.
Price display is about how prices are shown on tickets, shelves, websites, menus and advertisements. Under the Australian Consumer Law, a business advertising to consumers must show a single price that includes all taxes and compulsory charges, including GST, and this is enforced by the consumer protection regulators. It is not enough to advertise a price and add GST at the checkout.
The rule means that a shop selling a taxable item at a total of $55 must display $55, not $50 plus GST. Businesses can still show the GST amount separately, but the most prominent price must be the total that the customer will have to pay. Optional extras can be shown separately, but mandatory charges such as booking fees and compulsory surcharges should be built into the headline price.
Business-to-business pricing is different. A supplier who deals only with businesses may show prices exclusive of GST, as long as it is clear that GST is not included and the customer is not likely to be misled. Many trade suppliers and wholesalers do this. If their customers include consumers, the prices shown must meet the consumer rules.
Tax invoices follow a different rule. A tax invoice must show the GST, or state that the total price includes GST, as set out in the GST law. This is distinct from price display requirements, which are about advertising and pricing information. A business must meet both the consumer law rules and the tax invoice rules at the same time.
Common misunderstandings include thinking that GST-exclusive display is allowed anywhere as long as a disclaimer is shown, or that a small note is enough. The headline price needs to be the total. Another mistake is changing prices at the checkout, for example by adding GST or fees after the customer has selected a product. Online businesses should ensure their shopping carts show the final price early in the process.
Check your price lists, website, signage and checkout flow to confirm that they follow the rules. The consumer protection rules are administered by the ACCC and state and territory fair trading bodies, not the ATO. This page is general information only, so confirm your situation with the ACCC, the ATO or a registered tax professional.
Worked example
A hardware store sells a drill with a GST-exclusive price of $200. The consumer-facing ticket must show $220, being $200 plus GST of $20. A trade-only supplier selling the same drill to registered builders might show $200 plus GST, as long as it is clear that GST is extra, and the tax invoice shows GST of $20 and a total of $220.
Practical tips
- For consumer sales, display a single total price that includes GST and any compulsory charges.
- If you sell to both businesses and consumers, make sure your consumer-facing prices include GST even if your trade prices do not.
- Have someone who has not seen your price lists look at your website and signage, as a fresh eye often spots hidden extras.