Commonwealth Procurement Thresholds, and Why GST Matters
By FastTender · 8 July 2026 · 6 min read
The Commonwealth Procurement Rules that commenced on 17 November 2025 raised the main procurement threshold from $80,000 to $125,000. If you have been working from older guidance, your mental model of when a tender must be advertised is now wrong.
The current thresholds
- Non-corporate Commonwealth entities: $125,000 including GST
- Some prescribed corporate Commonwealth entities: $400,000 including GST, though some sit at $125,000
- Construction services: $7.5 million including GST
What changes at the threshold
Below it, only Division 1 of the Commonwealth Procurement Rules applies. The buyer must still achieve value for money but can approach the market however it judges best, including going straight to a panel or a single supplier.
At or above it, Division 2 adds prescriptive process rules. The buyer must normally run an open approach to market on AusTender, allow the minimum response time, and meet the additional reporting requirements, unless a limited tender condition or an Appendix A exemption applies.
Every figure is GST inclusive
This is where suppliers get caught. The thresholds are GST inclusive and so are all values published on AusTender, but pricing schedules are written ex GST. A $120,000 ex GST quote is $132,000 including GST and sits above the threshold.
It also cuts the other way in competitive analysis. If you compare your ex GST price against a published contract value without converting, you will conclude you are ten per cent cheaper than the incumbent when you are not.
The value tested is the whole procurement
The buyer must estimate the maximum value of the entire procurement, including every option and extension, not just the first year. Splitting a procurement into pieces to keep each under a threshold is expressly prohibited.
Below threshold does not mean invisible
Whatever method was used, the resulting contract is still published as a contract notice if it is $10,000 including GST or more. The work is visible after the fact even when it never appeared as an open tender.