Issue
Is the entity, a professional fisherman, making a GST-free supply under section 38-2 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), when it sells a bulk catch of fresh dead fish?
Decision
Yes, the entity is making a GST-free supply under section 38-2 of the GST Act when it sells a bulk catch of fresh dead fish.
Facts
The entity is a professional fisherman. The entity sells a bulk catch of fish. The fish are sold dead, fresh, chilled and unprocessed, apart from cleaning or skinning certain varieties in readiness for sale. The entity sells the catch as food for human consumption.
The entity is registered for goods and services tax (GST).
Reasons for Decision
A supply of food is GST-free under section 38-2 of the GST Act if it satisfies the definition of food in section 38-4 of the GST Act and it is not excluded by section 38-3 of the GST Act.
Food is defined in paragraph 38-4(1)(a) of the GST Act to include food for human consumption (whether or not requiring processing or treatment). In this case, the fish are dead and are supplied as food for human consumption. Therefore, the fish satisfy the definition of food contained in paragraph 38-4(1)(a) of the GST Act.
However, under paragraph 38-3(1)(c) of the GST Act, a supply of food is not GST-free if it is food of a kind specified in the table in clause 1 of Schedule 1 to the GST Act (Schedule 1). Fresh dead fish do not fall under any item in Schedule 1.
In addition, the supply of the fresh dead fish does not fall within any of the other exclusions in section 38-3 of the GST Act. Therefore, the entity is making a GST-free supply of a bulk catch of fresh dead fish under section 38-2 of the GST Act. [Note: Some GST-free food products have alternative non-food uses. There is no requirement for the entity to ascertain how the purchaser will use the product. The GST status of the product depends on whether it is a supply of food for human consumption as defined in the GST Act. If the entity differentiates the catch or part of it as something other than food for human consumption it is subject to GST. For example, if you differentiate your catch or part of it as bait it is subject to GST].