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Edited version of your written advice
Authorisation Number: 1012781226031
Ruling
Subject: Foods
Question 1
Are the supplies of foods goods and services tax (GST) free?
Answer
Yes
Question 2
Are the supplies of drinks GST-free?
Answer
Yes
Relevant facts and circumstances
• You are registered for GST.
• You supply takeaway food.
• The food does not contain any animal products.
• The food is prepared by blending fruits and vegetables and then chilling (not frozen)
• The food is supplied chilled.
• The food is not a prepared meal.
• You also supply drinks that contain at least 90% juices of fruits and vegetables.
• The drinks are non-alcoholic and non-carbonated. .
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) provided that the supply does not come within any of the exclusions listed in section 38-3 of the GST Act.
Food is defined in section 38-4 of the GST Act to include foods for human consumption (paragraph 38-4(1)(a)) and beverages for human consumption (paragraph 38-4(1)(c)). The foods and drinks are for human consumption. Therefore the food and drinks satisfy the meaning of food in section 38-4 of the GST Act
You supply the chilled food and drinks as takeaways. Therefore we need to consider whether the food is excluded from being GST-free by paragraph 38-3(1)(c) and the drinks are excluded from being GST-free by paragraph 38-3(1)(d).
Paragraph 38-3(1)(c) 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). The phrase 'of a kind' is not defined in the GST Act and therefore it takes the form of the ordinary meaning. The Macquarie Dictionary does not define the entire phrase 'of a kind' but it defines the word 'kind' as
'1. A class or group of individuals of the same nature or character, especially a natural group of animals or plants. 2. Nature or character as determining likeness or difference between things: things differing in degree rather than in kind. 3. A person or thing as being of a particular character or class: he is a strange kind of hero. 4. ....'
Therefore a food will be 'of a kind' food listed in Schedule 1 if it is of the same nature or character (having the same distinguishing qualities) as the food listed in an item in Schedule 1.
Food
Your food is made from fruits and vegetables. The food does not contain animal products. You prepare the food by blending fruits and vegetables and then chilling the food. You do not supply hot food and your food is not a prepared meal. Therefore the items in Schedule 1 that may be relevant to your food are items 20 and 29 of Schedule 1.
Item 20 in Schedule 1 (Item 20) lists various bakery items such as a cake, slice, cheesecake, pancake, waffle, crepe, muffin or pudding. The ingredients for these foods are flour/rice, eggs, oil, salt, dairy products, water, etc. These foods are cooked by baking, steaming, etc.
Your food does not have the same characteristics as foods listed in item 20. Your food is prepared by blending fruits and vegetables only. They are not cooked unlike foods listed in item 20. Your food does not contain animal products, dairy products and eggs. They are supplied as chilled foods.
Item 29 of Schedule 1 (item 29) lists frozen confectionery, frozen yoghurt and frozen fruit products (but not frozen whole fruit). The food products are intended to be consumed as frozen or soft served foods
Your food is made from fruits and vegetables. However, the food is not frozen or soft served. The food is supplied chilled. Therefore they are not foods of a kind listed in item 29.
Therefore your food is not listed in Schedule 1 and is not excluded from being GST-free by paragraph 38-3(1)(c) of the GST Act.
Drinks
Paragraph 38-3(1)(d) provides that a supply of a beverage or as an ingredient for a beverage is not GST-free unless it is of a kind listed in the table in clause 1 of Schedule 2 of the GST Act (Schedule 2). As the drinks are prepared from fruits and vegetables, the relevant item in Schedule 2 that may apply to the drinks is item 12.
Fruit and vegetable juices that are listed in item 12 of Schedule 2 (item 12) is GST-free where the beverage is a non-alcoholic and non-carbonated beverage and it contains at least 90% of juices of fruits or vegetables by volume.
Your drinks are prepared from fruits and vegetables. Your drinks contain at least 90% of juices of fruits and vegetables. They are non-alcoholic and non-carbonated. Therefore, your drinks are listed in item 12 and are not excluded from being GST free by paragraph 38-3(1)(d).
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