4Sale value of goods

4 Sale value of goods

(1) Subject to subsection (3) of this section, to section 4A and to subsections (5B) and (5C) of section 18 of the Sales Tax Assessment Act (No. 1) 1930 in their application in accordance with section 12 of this Act, for the purposes of this Act, the sale value of goods shall be the amount for which those goods are sold by a registered person, or a person required to be registered, who imported those goods, to an unregistered person or to a registered person who has not quoted his certificate in respect of the purchase of those goods: Provided that where goods are sold by retail by a registered person who has quoted his certificate when importing the goods the sale value of the goods shall be the amount which would be the fair market value of those goods if sold by him by wholesale, but if the Commissioner is of opinion that the amount set forth in any return by the registered person as the sale value of any such goods is less than the amount which would be their fair market value if sold by wholesale, the Commissioner may alter the amount set forth in the return to the amount which, in his opinion, would be the fair market value of the goods if sold by wholesale, and the amount as so altered shall be the sale value of the goods for the purposes of this Act. (1A) For the purposes of this Act the sale value of goods imported by a registered person who quoted his certificate in respect of the entry of those goods for home consumption, and who applies those goods to his own use, shall be the amount which would have been the sale value of those goods for purposes of the Sales Tax Assessment Act (No. 5) 1930‑1931 if that person had not so quoted his certificate. (2) Where: (a) goods (in this subsection referred to as the relevant goods) imported into Australia by a registered person, or by a person required to be registered, have been sold after 20 September 1978 by the importer of the goods to an unregistered person or to a registered person who has not quoted his certificate in respect of the purchase of the goods; (b) the Commissioner is satisfied that, having regard to any connection between the importer and the purchaser of the relevant goods or to any other relevant circumstances (including circumstances arising out of any agreement entered into between the importer and the purchaser, or out of any other agreement, that was related, directly or indirectly, to the sale of the goods), the importer and the purchaser were not dealing with each other at arm’s length in relation to the transaction; and (c) the Commissioner is also satisfied: (i) that the amount for which the relevant goods were sold is less than the amount (in this subsection referred to as the arm’s length price) for which, in the opinion of the Commissioner, the relevant goods could reasonably be expected to have been sold if the importer and the purchaser had been dealing with each other at arm’s length in relation to the transaction; or (ii) that: (A) the purchaser could have purchased identical goods from another importer by wholesale and obtained delivery of the identical goods at or about the time when the purchaser obtained delivery of the relevant goods; and (B) the amount for which the relevant goods were sold is less than the amount (in this subsection referred to as the alternative price) for which, in the opinion of the Commissioner, the identical goods could reasonably be expected to have been sold to the purchaser; the Commissioner shall alter the sale value of the relevant goods to the amount ascertained in accordance with the following paragraphs: (d) if the Commissioner is satisfied as to the matter mentioned in subparagraph (i) of paragraph (c) but not as to the matters mentioned in subparagraph (ii) of that paragraph—an amount equal to the arm’s length price; (e) if the Commissioner is satisfied as to the matters mentioned in subparagraph (ii) of paragraph (c) but not as to the matter mentioned in subparagraph (i) of that paragraph—an amount equal to the alternative price; (f) if the Commissioner is satisfied as to the matter mentioned in subparagraph (i) of paragraph (c) and also as to the matters mentioned in subparagraph (ii) of that paragraph—an amount equal to the lesser of: (i) the arm’s length price; and (ii) the alternative price. (3) Where the Commissioner alters the sale value of goods in pursuance of subsection (2), the sale value so altered shall be the sale value of the goods for the purposes of this Act. (4) For the purposes of this section, the sale value of goods shall not be increased by any amount payable in respect of sales tax, but, when the goods are sold either in bond or while otherwise subject to the control of the Customs, the sale value shall be increased by the amount of any duty of Customs to which the goods would be subject if entered for home consumption at the time at which they are sold. (5) In this section: (a) agreement means any agreement, arrangement or understanding: (i) whether formal or informal; (ii) whether express or implied; or (iii) whether or not enforceable, or intended to be enforceable, by legal proceedings; and (b) a reference to identical goods shall be read as a reference to goods identical in all material respects with the goods in relation to which the expression is used.