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Edited version of your written advice

Authorisation Number: 1051309901656

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Date of advice: 27 November 2017

Ruling

Subject: GST and food

Question

Is the sale of takeaway coleslaw, potato salad and seafood salad by you a GST-free supply?

Answer

Yes.

Relevant facts and circumstances

Relevant legislative provisions

A New Tax System (Goods and Services Tax) Act 1999 Section 38-2.

A New Tax System (Goods and Services Tax) Act 1999 Section 38-3

A New Tax System (Goods and Services Tax) Act 1999 Section 38-4

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 it satisfies the definition of food in section 38-4 of the GST Act and is not excluded from being GST-free under section 38-3 of the GST Act.

The meaning of food in section 38-4 of the GST Act includes food for human consumption (whether or not requiring processing or treatment).

In your case, the salads you supply are food for human consumption. Therefore, the prepared salads fall within the meaning of food in section 38-4 of the GST Act as food for human consumption and, as such, are GST-free.

However, subsection 38-3(1) of the GST Act explains which food is not GST-free and states:

(* denotes a term defined in the GST Act)

You advised that the salads are to takeaway from the premises. Further, the food is neither hot food nor a beverage and it is not specified in the A New Tax System (Goods and Services Tax) Regulations 1999 (GST Regulations). Therefore, paragraphs 38-3(1)(a), (b), (d) and (e) do not apply.

However, under paragraph 38-1(c) of the GST Act, 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. Of specific relevance is item 4 of the table, which provides that food marketed as a prepared meal (but not including soup) is not GST-free.

The GST Detailed Food List available on the Tax Office website states that salad (e.g. green, rice, pasta, coleslaw) not marketed as a prepared meal is GST-free.

For further clarification, Issue 5 of the Food Industry Partnership – Issues Register, discusses the issue of what is considered a prepared meal for GST purposes.

Therefore, for food to be regarded as a prepared meal under item 4 of Schedule 1, the food needs to be assembled, dressed, cooked or partly cooked.

In your case, although the coleslaw, potato salad and seafood salad require refrigeration and are duly assembled, dressed and ready for consumption they are not similar to the examples listed above. Further, the takeaway salads are not marketed as a prepared meal.

Therefore, the salads you provide as takeaway salads do not come within the range of the exclusions mentioned in section 38-3 of the GST Act.

Accordingly, when you supply takeaway coleslaw, potato salad and seafood salad you are making a GST-free supply under section 38-2 of the GST Act.


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