Private ruling: GST classification of the food products
Date of advice: 29 July 2022
Published: November 2022

Ruling: Q1: Is the supply of various cultures products ('Products') by an Australian GST-free under section 38-2 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)? | A1: Yes. The supply of the Products is GST-free under section 38-2 of the GST Act because: • the Products satisfy the definition of food in paragraph 38-4(1)(a) of the GST Act as food for human consumption (whether or not requiring processing or treatment); and • while the Products are food of a kind specified in regulations made for the purposes of paragraph 38-3(1)(e) of the GST Act , the supply of the Products is not prevented from being GST-free because of subsection 38-3.01 (2) of the GST Regulations.

Relevant facts and circumstances: You are an Australian entity and registered for GST. You supply various cultures products ('Products') that are required for the acidification of cheese and yoghurts which changes the structure of the proteins. The Products are supplied in a sachet. You do not market the Products for retail sale. You do not sell the Products directly to retail stores. You market and supply the Products as a food additive to dairy manufacturers. The Products are a processing aid that are essential for the manufacture of various dairy products. The nutritional information of the Products complies with the Foods Standards Code. The Products are solely used for, and are essential to, the manufacture of various dairy products. The Products are essential to the composition of food.

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) | A New Tax System (Goods and Services Tax) Act 1999 paragraph 38-4(1)(f) | A New Tax System (Goods and Services Tax) Act 1999 Schedule 1 clause 1