Sterling Guardian Pty Ltd v Commissioner of Taxation

In Sterling Guardian Pty Ltd v Commissioner of Taxation, the appellant, Sterling Guardian, challenged the Federal Court's decision that it was liable for GST on the supply of security services provided to the Commonwealth. The High Court was called upon to determine the extent of the Commonwealth’s immunity from GST under the GST Act.

The primary legal issue before the court was whether the supply of security services by Sterling Guardian to the Commonwealth was subject to GST, given the Commonwealth's constitutional immunity from tax. The appellant argued that its supplies to the Commonwealth were exempt from GST under the Act, relying on statutory provisions that exempt certain services provided to the government. The respondent, the Commissioner of Taxation, contended that the statutory exemptions did not apply to the appellant's services, which were supplied to the Commonwealth, and thus GST was payable.

The High Court held that the Commonwealth’s constitutional immunity from tax extended to GST, and therefore, the supplies of security services to the Commonwealth were not subject to GST. The court reasoned that the statutory exemptions did not override the constitutional immunity, which is a fundamental principle of Australian law. Consequently, the appellant's appeal was dismissed, and the appellant was ordered to pay the respondent's costs, including reserved costs.