Consideration for tolerating or refraining from an act taxable only where an express or implied contractual supply exists. GST applies to payments only when they constitute consideration for an independent contractual supply of agreeing to refrain from an act, to tolerate an act or situation, or to do an act. Payments that merely compensate for breach, statutory cancellation compensation without a toleration agreement, penalties for legal violations, cheque dishonour fines and forfeiture of earnest money where nothing is supplied in return are not consideration and are not taxable. Conversely, charges that represent ancillary facilities bundled with a principal supply (late payment acceptance, cancellation fees, early termination or prepayment facilities) are consideration for supply and taxable at the rate of the principal supply.