Geo owns a juice bar. The fridge he uses to store raw materials in broke down earlier this year. He contracted his friend Allen, who is an electrician, to repair the fridge. Allen spent 2 hours fixing the fridge. Allen’s ordinary hourly rate is $110. Instead of paying Allen $220 for his services, both of them agreed that Geo would provide him with juice worth $220 rather than payment in cash. Assuming both parties are registered for GST, advise them of the GST implications of this arrangement. Would your answer be different if Allen repaired the fridge for free?

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Bartering is a common practice among people and businesses Hence the designers of GST law were sma... View the full answer