ATO Interpretative Decision
ATO ID 2004/418 (Withdrawn)
Goods and Services Tax
GST and powdered pudding mixFOI status: may be released
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Withdrawn. The ATO view for this issue is covered in the GST food guide - Section 3 - Detailed food list.This document incorporates revisions made since original publication. View its history and amending notices, if applicable.
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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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 GST-free supply under section 38-2 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it supplies powdered pudding mix?
Decision
Yes, the entity is making a GST-free supply under section 38-2 of the GST Act when it supplies powdered pudding mix.
Facts
The entity is a food supplier. The entity supplies powdered pudding mix. The pudding is not ready for consumption until water has been added.
The entity is registered for goods and services tax (GST).
Reasons for Decision
A supply of food is GST-free under section 38-2 of the GST Act if the product satisfies the definition of food in section 38-4 of the GST Act and the supply is not excluded from being GST-free by section 38-3 of the GST Act.
Food is defined in section 38-4 of the GST Act to include ingredients for food for human consumption (paragraph 38-4(1)(b) of the GST Act). The powdered pudding mix requires water to be added before it can be consumed. Therefore, powdered pudding mix is an ingredient for food for human consumption that satisfies the definition of food contained in paragraph 38-4(1)(b) of the GST Act.
However, paragraph 38-3(1)(c) of the GST Act provides that a supply of food is not GST-free if it is food of a kind specified in the table in clause 1 of Schedule 1 to the GST Act (Schedule 1).
Item 20 in Schedule 1 (Item 20) lists cakes, slices, cheesecakes, pancakes, waffles, crepes, muffins and puddings.
All of the products listed in Item 20 are bakery products that are ready for consumption. Powdered pudding mix is an ingredient used to make a pudding and the product is not ready to be consumed until water has been added. Powdered pudding is not a pudding in itself, but rather an ingredient that is used to make a pudding. As such, powdered pudding mix is not covered by Item 20 and therefore, is not food of a kind listed in Schedule 1.
In addition, the supply of powdered pudding mix does not fall within any of the other exclusions in section 38-3 of the GST Act.
Therefore, the entity is making a GST-free supply under section 38-2 of the GST Act when it supplies powdered pudding mix.
Date of decision: 30 November 2001
Legislative References:
A New Tax System (Goods and Services Tax) Act 1999
section 38-2
section 38-3
paragraph 38-3(1)(c)
section 38-4
paragraph 38-4(1)(b)
Schedule 1 clause 1
Schedule 1 clause 1 table item 20
Keywords
Goods and services tax
GST free
GST food
Food for human consumption
Ingredients for food
ISSN: 1445-2782
| Date: | Version: | |
| 30 November 2001 | Original statement | |
| You are here | 3 February 2006 | Archived |