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Edited version of private advice
Authorisation Number: 1052352057751
Date of advice: 21 January 2025
Ruling
Subject: GST - collagen powder
Question 1
Is your supply of the collagen powder (the Product) a GST-free supply pursuant to section 38-2 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)?
Answer 1
Yes, your supply of the Product is a GST-free supply pursuant to section 38-2 of the GST Act.
The supply of the Product is GST-free under section 38-2 of the GST Act because:
• the Product is an ingredient for food, for human consumption therefore satisfies the definition of food in paragraph 38-4(1)(b) of the GST Act; and
• the Product is not excluded from being GST-free by section 38-3 of the GST Act.
Relevant facts and circumstances
You are an Australian entity and registered for GST.
You manufacture and sell the Product in bulk sizes to food manufacturers to use in food industry or to repackage for resale. The Product is extracted from animal skins and fit for human consumption.
You provide your website, product specification document and nutritional table. There is no direction for use to customers.
The Product is to be packaged in X kg brown paper bags and sold for further processing and/or repackaging into retail products.
You are selling the Product as an ingredient (without a specific purpose) but you understand that it is likely to be used in the following ways:
• Repackaged into retail packs in its current state (pure collagen)
• Repacked into retail packs with other ingredients (including flavourings)
• Used an ingredient by food manufacturers (eg. in protein bars)
The Product is not marketed as an ingredient for confectionery.
Relevant legislative provisions
A New Tax System (Goods and Services Tax) Act 1999, section 13-5
A New Tax System (Goods and Services Tax) Act 1999, section 13-10
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
A New Tax System (Goods and Services Tax) Act 1999, Schedule 1, clause 1
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