Private ruling: Food classification
Published: July 2012

Ruling: Q1: Is the supply of the dessert GST free? Decisions No



Reasons for decision: Summary: 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 dessert are food for human consumption, they satisfy the definition of food in paragraph 38-4(1)(a) of the GST Act. Subsection 38-3(1) of the GST Act provides that a supply of food is not GST-free if it is a supply of, amongst other things: · food for consumption on the premises from which it is supplied, or · hot food for consumption away from those premises, or · food of a kind specified in Schedule 1 of the GST Act, or · food that is a combination of one or more foods at least one of which is food of such a kind The desserts are not sold as hot food and are not for consumption on the suppliers' premises. Next we have to consider whether the desserts are food of a kind specified in the table in clause 1 of Schedule 1 to the GST Act (Schedule 1). In your case we consider item 20 in Schedule 1 (Item 20) maybe applicable to your desserts. Item 20 is about cakes, slices, cheesecakes, pancakes, waffles, crepes, muffins and pudding. | Detailed Reasoning - Desserts: The desserts have the sponge cake as a base and a filling on top. We do not consider the desserts to be dairy desserts for GST purposes (which is GST free). The base layer is made up of a sponge cake which is prepared as cake separate from the fillings and the base is not prepared using cold-set method, as the method is normally used to prepare dairy desserts. Therefore, we consider that the dessert to be food of a kind similar to foods described in item 20. As they are foods of a kind listed in Schedule 1 and they are therefore excluded from being GST free under section 38-3 of the GST Act (paragraph 38-3(1)(c ) of the GST Act. For your information the GST status of food is outlined in the ATO public ruling "Detailed Food List" (Food lists). We enclose a copy for your reference. The relevant items relating to your desserts listed on the Food Lists is as follows: Item GST status Notes cakes (supplied hot or cold or requires cooking, heating, thawing or chilling prior to consumption taxable Schedule 1, item 20 and clause 2 of the GST Act apply.

Please check this edited version to be sure that there are no details remaining that you think may allow you to be identified. If you have any concerns about this ruling you wish to discuss, you will find our contact details in the fact sheet. | Relevant facts: You are registered for the goods and services tax (GST). | You retail the desserts for human consumptions. | The desserts contain sponge cake as a base with a sweet filling on top.