| Disclaimer This edited version has been archived due to the length of time since original publication. It should not be regarded as indicative of the ATO's current views. The law may have changed since original publication, and views in the edited version may also be affected by subsequent precedents and new approaches to the application of the law. You cannot rely on this record in your tax affairs. It is not binding and provides you with no protection (including from any underpaid tax, penalty or interest). In addition, this record is not an authority for the purposes of establishing a reasonably arguable position for you to apply to your own circumstances. For more information on the status of edited versions of private advice and reasons we publish them, see PS LA 2008/4. |
Edited version of your private ruling
Authorisation Number: 1012433540575
Ruling
Subject: GST and food
Question
Will your supply of certain food products (Products) be subject to goods and services tax (GST)?
Answer
No. Your supply of the Products will be GST-free as food. Your importation of the Products will be non-taxable as a consequence.
Relevant facts and circumstances
· You are registered for GST.
· You intend to import and supply the Products.
· Each Product requires that it is added to boiling water prior to being consumed.
· The Products do not require refrigeration or freezing for their storage.
· Some of the Products are also available in a smaller serve size.
· The Products are made from ingredients fit for human consumption and have nutritional value.
· The ingredients have been freeze-dried and dehydrated.
· You have supplied a website where the Products can be viewed.
Relevant legislative provisions
A New Tax System (Goods and Services Tax) Act 1999
Section 38-2
Section 38-3
Section 38-4
Clause 1 of Schedule 1
Clause 3 of Schedule 1.
Reasons for decision
A supply of food is GST-free under section 38-2 of the A New Tax System (Goods and Services Tax) Act 1999 (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.
The definition of food in section 38-4 of the GST Act includes food for human consumption, whether or not requiring processing or treatment. The Products will be marketed and sold as food for human consumption, have ingredients fit for human consumption and have nutritional value. Consequently, they can be treated as food for human consumption.
The supply of the Products do not fall within any of the exclusions in section 38-3 of the GST Act except for possibly paragraph 38-3(1)(c). 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 that is specified in the table in clause 1 of Schedule 1 to the GST Act (Schedule 1).
Schedule 1 includes the following food items that may be of relevance when considering the GST treatment of your supply of the Products:
· food marketed as a prepared meal, but not including soup (Item 4 of Schedule 1).
Some of the Products have characteristics that are found in prepared meals. However, clause 3 of Schedule 1 provides that prepared meals covered by Item 4 of Schedule 1 must be food that requires refrigeration or freezing for their storage. In your case, the Products do not require refrigeration or freezing for their storage and therefore are not covered by Item 4 of Schedule 1.
Consequently, your supply of the Products will be a GST-free supply of food under section 38-2 of the GST Act. Also note that the supply of the Products will be GST-free all along the supply chain.
Non taxable importation
Section 13-10 of the GST Act provides that an importation is a non-taxable importation if:
· it is a non-taxable importation under Part 3-2 of the GST Act, or
· it would have been a supply that was GST-free or input taxed if it had been a supply (for example, it would be a GST-free supply had the supply been made in Australia).
In your case, your supply of the Products in Australia will be GST-free and consequently, your importation will be non-taxable under section 13-10 of the GST Act.
Copyright notice
© Australian Taxation Office for the Commonwealth of Australia
You are free to copy, adapt, modify, transmit and distribute material on this website as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).
