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This edited version has been archived due to the length of time since original publication.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.

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Edited version of private ruling

Authorisation Number: 1011662519147

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Ruling

Subject: GST and organic cereal leaf powders

Question

Are the products specified in the facts below GST-free?

Answer

Yes, the products specified in the facts below are GST-free.

Facts

    · You are registered for goods and services tax (GST).

    · You produce powder food products.

    · Your powders have no additives, are 100% organic, and have no claimed medical benefits.

    · Your procedures your products undertake before sale involve growing a food crop, harvesting it and producing a powder for human consumption.

    · Your end product is sold to the public in cartons and tubs.

    · All your products are for human consumption.

    · The serving instructions suggest that your powder food products can be added to water or juice or sprinkled directly on to other foods.

Detailed reasoning

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.

Food is defined in section 38-4 of the GST Act to include food for human consumption (whether or not requiring processing or treatment) (paragraph 38-4(1)(a) of the GST Act).

You advised us that your powder products (Products) are supplied as food for human consumption. Therefore, your Products satisfy the definition of food in paragraph 38-4(1)(a) of the GST Act.

The serving instructions suggest that your Products can be added to beverages or sprinkled directly on to food as food.

However, under paragraph 38-3(1)(c) of the GST Act, 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). Your Products are not food of a kind specified in Schedule 1.

Moreover, the supply of your Products does not fall within any of the other exclusions in section 38-3 of the GST Act. Therefore, you are making a GST-free supply under section 38-2 of the GST Act when you supply your Products.


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