How will the GST apply to nursing homes, hospices and hostels?

	Generally nursing homes, hospices and hostels will not be subject to the goods and services tax (GST).
The precise scope of health services for the aged that will be GST-free will be the subject of consultation following the election.
Will it cost more to put a relative in a nursing home or hospice?
No.  Goods and services (accommodation, medicines, meals etc) supplied as part of a resident’s care will be GST-free.  Some minor additional charges for services such as hair cuts and hire of televisions will be subject to GST.
Will home nursing care be subject to the GST?
No.  They will be GST-free.  Nursing home services provided to the elderly in their own home, including Home and Community Care  services, will be treated in the same manner as if the person had been a resident in a nursing home.  
Will the purchase of a new dwelling in a retirement village be subject to GST?
Yes.  The construction and sale of new homes will be subject to the GST in the normal manner even where the home is part of a retirement complex.  The sale of an existing home will not be taxed.
What about charges related to health services received within the retirement village?
Separate charges for health services received within a retirement village will be GST-free.  This is consistent with the overall treatment of health services.
Will pension increases be quarantined from nursing home fees?
Yes.  The Government will take whatever steps are necessary to ensure that the full 4 per cent increase in pensions flows through to pensioners.	

For further information	

‘A New Tax System’  Chapter 2.
Other fact sheets:  No. 200  ‘The GST at a glance’ and  No. 206  ‘GST Glossary:  What do the new terms mean?’.
The Government’s Tax Reform Website:  http://www.taxreform.gov.au
Tax Reform Information Centre:  Telephone 13 30 99