Edited version of private advice

Authorisation Number: 1052276451226

Date of advice: 23 June 2025

Ruling

Subject: GST and protein powders

Questions 1

1. Is your importation of Product 1 and Product 2 (Products) a non-taxable importation as defined in section 13-10 of the A New Tax System (Goods and Services Tax) Act 1999 (GST) Act?

2.Is your supply of the Products a GST-free supply by virtue of section 38-2 of the GST Act?

Answers 1

1. Yes. Your importation of the Products is a non-taxable importation under section 13-10 of the GST Act, because had the importation been a supply it would have been GST-free. GST is not payable on importation of the Products.

2. Yes. your supply of the Products is a GST-free supply by virtue of section 38-2 of the GST Act because:

•                     the Products are ingredients for food for human consumption and satisfy the definition of ingredients for food in paragraph 38-4(1)(b) of the GST Act; and

•                     the Products are not excluded from being GST-free by section 38-3 of the GST Act.

Relevant facts and circumstances

The Products are edible proteins derived by utilising water to breakdown the bonds of collagen. Collagen is the chief protein component of the skin, connective tissue and bones.

The Products are generally sold in a powder form.

Your customers include food manufacturers, beverage manufacturers, confectionery manufacturers, pharmaceutical or nutraceutical, sports supplement entities, and resellers.

You have no control of how any given customer will utilise the Products that it acquires from you and many customers will use the same product as an input into a variety of goods that it produces.

You do not differentiate, package, or label the Products differently to your customers irrespective of the nature of the customer or their intended use of the Products.

Product 1 could be used in many food applications such as beverages, powder blends, dairy products, confectionary, desserts, prepared meals, cereals, etc. Further examples are: gummies, chocolate, muesli bars and other nutritional bars. They can also be used in nutraceuticals.

While some of Product 1 may be used by some of your customers in producing beauty or sports nutritional supplements, the Products have a much longer history of use in food manufacturing. You supply the Products in an undifferentiated form to many customers on the basis that the products meet Australian food standards. You do not supply beauty products or sports supplements.

Product 2 are sold for dairy application and meat applications. Product 2 have a slightly different taste profile which may make them more preferrable for use in products that are not sweet in nature.

Products 1 and 2 are imported by you as finished products and sold to customers in Australia without undergoing any further processing or change in packaging.

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 paragraph 38-3(1)(c)

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

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

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)

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

A New Tax System (Goods and Services Tax) Regulations 2019 regulation 38-3.01