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ATO Interpretative Decision

ATO ID 2001/437

Goods and Services Tax

GST and the supply of a right to receive a GST-free supply of food
FOI status: may be released

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CAUTION: This is an edited and summarised record of a Tax Office decision. This record is not published as a form of advice. It is being made available for your inspection to meet FOI requirements, because it may be used by an officer in making another decision.

This ATOID provides you with the following level of protection:

If you reasonably apply this decision in good faith to your own circumstances (which are not materially different from those described in the decision), and the decision is later found to be incorrect you will not be liable to pay any penalty or interest. However, you will be required to pay any underpaid tax (or repay any over-claimed credit, grant or benefit), provided the time limits under the law allow it. If you do intend to apply this decision to your own circumstances, you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed. You may wish to obtain further advice from the Tax Office or from a professional adviser.

Issue

Is the entity, a food supplier, making a taxable supply under section 9-5 of the A New Tax System (Goods & Services Tax) Act 1999 (GST Act), when it sells a right to receive a GST-free supply of food?

Decision

No, the entity is not making a taxable supply under section 9-5 of the GST Act when it sells a right to receive a GST-free supply of food. The entity is making a GST-free supply under paragraph 9-30(1)(b) of the GST Act.

Facts

The entity is a food supplier. The entity sells a right to receive a GST-free supply of food. The entity is registered for goods and services tax (GST).

Reasons for Decision

Under section 9-5 of the GST Act, a supply is not a taxable supply to the extent that it is GST-free.

Paragraph 9-30(1)(b) of the GST Act provides that where a right is granted to receive a supply that is GST-free, the supply of that right is also GST-free.

The entity is granting a right to another entity to receive a GST-free supply of food. The supply of the food is GST-free under section 38-2 of the GST Act. Therefore, the supply of a right to receive the food is GST-free under paragraph 9-30(1)(b) of the GST Act. The supply is GST-free and as such the entity is not making a taxable supply.

Date of decision:  26 July 2001

Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
   section 9-5
   section 9-30
   subsection 9-30(1)
   paragraph 9-30(1)(b)
   section 38-2

Related ATO Interpretative Decisions
ATO ID 2001/436

Keywords
Goods & service tax
GST free
GST food
GST Food for human consumption
Live animals

Business Line:  Goods and services tax

Date of publication:  11 October 2001

ISSN: 1445-2782

history
  Date: Version:
You are here 26 July 2001 Original statement
  13 September 2005 Archived

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