Edited version of your written advice

Authorisation Number: 1051195317217

Date of Advice: 24 February 2017

Ruling

Subject: Goods and Services Tax (GST) meaning of premises where food is supplied

Question 1

Is a supply of fresh juice at a drive-through store located in the car parks of a shopping centre considered to be 'food for consumption on the premises from which it is supplied'?

Answer

No, the supply of fresh juice at a drive-through store located in the car parks of a shopping centre is not considered to be 'food for consumption on the premises from which it is supplied'.

Relevant facts and circumstances

You are registered for GST.

You sell fresh juices at your drive-through store.

The fresh juices are 100% fresh fruit and vegetable juice with no ice added.

Your drive-through store is located in the car parks of a big shopping centre.

The distance from your drive-through store to the nearest entrance of the shopping centre is at least X metres.

Relevant legislative provisions

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

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 paragraph 38-3(1)(a)

A New Tax System (Goods and Services Tax) Act 1999 paragraph 38-3(1)(d)

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

A New Tax System (Goods and Services Tax) Act 1999 paragraph 38-4(1)(c)

A New Tax System (Goods and Services Tax) Act 1999 section 38-5

A New Tax System (Goods and Services Tax) Act 1999 clause 1 of Schedule 2

A New Tax System (Goods and Services Tax) Act 1999 item 12 of Schedule 2

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 it does not come within any of the exclusions listed in section 38-3 of the GST Act.

Paragraph 38-4(1)(c) of the GST Act defines 'food' to include beverages for human consumption. It is considered that fruit and vegetable juices are beverages for human consumption. However, under paragraph 38-3(1)(d) of the GST Act, a supply of a beverage is not GST-free unless it is a beverage, or an ingredient for a beverage, of a kind specified in the table in clause 1 of Schedule 2 of the GST Act (Schedule 2).

Item 12 in Schedule 2 (Item 12) provides that non-alcoholic non-carbonated beverages will only be GST-free if they consist of at least 90% by volume of juices of fruits or vegetables.

You stated that the fresh juices that are sold at your drive-through store are 100% fresh fruit and vegetable juice with no ice added. This means these juices satisfy the requirements of Item 12 and would be GST-free if no other exclusions listed in section 38-3 of the GST Act apply.

Paragraph 38-3(1)(a) of the GST Act states that a supply of food for consumption on the premises from which it is supplied is not GST-free.

Section 38-5 of the GST Act provides that premises, in relation to a supply of food, include:

The place where the supply takes place; or

The grounds surrounding a café or public house, or other outlet for the supply; or

The whole of any enclosed space such as a football ground, garden, showground, amusement park or similar area where there is a clear boundary or limit;

But does not include any part of a public thoroughfare unless it is an area designated for use in connection with supplies of food from an outlet for the supply of food.

Goods and Services Tax Determination GSTD 2000/4 Goods and services tax: what does the word 'premises' mean in the expression, 'a supply of food for consumption on the premises from which it is supplied'? provides examples of situations where the food is considered to be provided on the premises from which it is supplied.

Of particular relevance are examples 3 and 5:

Example 3

9. Kevin has a takeaway food shop which does not have any seating. However, there is a bus shelter on the footpath just outside his shop. Some of his customers eat their food in the bus shelter. The bus shelter is on a public thoroughfare and it is not designated for use in connection with Kevin's shop. It does not form part of the shop premises.

Example 5

11. Sue operates a kiosk which is located within a swimming pool complex. The swimming pool complex is situated within a public park. Although the kiosk sells mainly to pool customers, there is also a window which faces out onto the park. It is the swimming pool complex that is the relevant premises. Food supplied and eaten inside the pool complex is supplied for consumption on the premises. The public park is a public thoroughfare and does not form part of the premises. Food sold through the window to customers in the park is not supplied for consumption on the premises.

In applying the principle highlighted in the above examples we consider that your drive-through store located in the car parks of a shopping centre is on a public thoroughfare and is not a designated area for use in connection with your supplies of fresh juice. Therefore, the supply fresh juice at a drive-through store is not a supply of food for consumption on the premises from which it is supplied.

This means your supply of fresh juice, which is 100% fruit and/or vegetable juice with no ice added, at your drive-through store located in the car parks of a shopping centre is GST-free according to subdivision 38-A of the GST Act.