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Edited version of private advice
Authorisation Number: 1051738144892
Date of advice: 8 September 2020
Ruling
Subject: GST and supply of powdered blend
Question
Is the supply of the Product GST-free pursuant to section 38-2 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)?
Answer
Yes.
A supply of food is GST-free under section 38-2 of the 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.
The supply of the Product is GST-free under section 38-2 of the GST Act because:
· the Product satisfies the definition of food in paragraph 38-4(1)(a) of the GST Act as food for human consumption and
· the supply of the Product does not fall within any other exclusions in section 38-3 of the GST Act.
Relevant facts and circumstances
You sell a range of superfood products.
You are registered for GST.
You provided a picture of the Product.
You provided a picture of the label which includes the following:
· The Product is a blend of nutrient rich wholefoods.
· The Product provides whole food nutrients, that are absorbed more effectively than those found in synthetic.
· The Product can contribute to your required daily servings of vegetables in a convenient and affordable way.
· How much of the Product one should consume can vary with activity levels, state of health and age.
· The suggested usage is to start with a few heaped tablespoons per day then adjust according to requirements.
· The Product may be taken with food or stirred into water, juice or other favourite beverage. The label includes a smoothie recipe.
The Product is marketed through its labelling principally as an ingredient for beverages; a powder to be mixed with water, juice or smoothies.
The Product is sold supermarkets, health food stores, pharmacies and online stores. The Product may be placed in the super foods, health foods or supplements section of the store.
The Product is most often just mixed with water or some other beverage such as juice or milk but may also be an ingredient of a blended smoothie.
The Product is also available in tablet form, which does not have the sweetener added.
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 Paragraph 38-3(1)(c).
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)(a).