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Edited version of your written advice
Authorisation Number: 1012887483052
Date of advice: 30 September 2015
Ruling
Subject: GST and food classification snack
Question
Is the supply of the dried fruit GST-free?
Answer
Yes.
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). As the dried fruits are food for human consumption, they satisfy the definition of food in paragraph 38-4(1)(a) of the GST Act.
However, section 38-3 of the GST Act specifies foods that are not GST-free. The relevant paragraph which may apply to the dried fruit is paragraph 38-3(1)(c) of the GST Act. The paragraph 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 dried fruits are not food of a kind specified in the table in clause 1 of Schedule 1 to the A New Tax System (Goods and Services Tax) Act 1999 (GST Act). Therefore, they are not excluded from being GST-free by paragraph 38-3(1)(c) of the GST Act.
Relevant facts and circumstances
• You are registered for the goods and services tax (GST).
• You carry on an enterprise.
• You import dried fruit from overseas to sell in health food shops in Australia.
• The products are bite-sized and contain dried fruits.
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 paragraph 38-3(1)(c)
A New Tax System (Goods and Services Tax) Act 1999 paragraph 38-4(1)(a)
A New Tax System (Goods and Services Tax) Act 1999 Schedule 1