Is There GST On Food In Australia? Full List

/ Goods and Services Tax (GST) / By

Updated for the 2026–27 financial year

Food for human consumption is GST-free under section 38-2 of the GST Act unless it falls into a specific exclusion listed in Schedule 1, in which case it is taxable at 10% GST. In plain terms, basic and unprocessed food like fresh fruit, vegetables, meat, bread, plain milk and eggs is GST-free. Prepared, hot, snack and restaurant food is taxable. This guide walks through the rules, gives you a quick reference list, and covers the tricky edge cases that catch people out.

what counts as gst free food in australia a complete guide for small businesses

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Is There GST On Food In Australia?

Yes and no, depending on the food. Most goods and services in Australia include 10% GST, but food works differently. Food for human consumption starts off GST-free under section 38-2 of the GST Act. It only becomes taxable if it matches one of the specific exclusions set out in Schedule 1.

This means basic, unprocessed food is generally GST-free. Fresh fruit and vegetables, raw meat, poultry and seafood, bread, plain milk, eggs, rice, pasta and flour all fall on the GST-free side. On the other side, prepared meals, hot takeaway food, restaurant meals, snacks, confectionery, soft drinks and alcohol are taxable.

A GST-free supply means no GST is included in the price and the seller does not collect or remit GST on that sale. A taxable supply means 10% GST applies.

Quick Reference: GST-Free Versus Taxable Food

Use this table for a fast answer. Keep in mind that an item that is normally GST-free can become taxable depending on how it is prepared, sold or consumed, which we explain further down.

GST-free (no GST) Taxable (10% GST)
Fresh fruit and vegetables (apples, bananas, lettuce, potatoes, tomatoes) Confectionery (chocolate, lollies, sweets, marshmallows, toffee)
Raw meat, poultry and seafood (beef, chicken, lamb, fish, prawns) Savoury snacks (chips, crisps, pretzels, crackers, flavoured popcorn)
Bread and bakery items (loaves, rolls, flat bread, bagels, English muffins) Biscuits and cookies (sweet, savoury, wafers, rice crackers)
Plain milk, cheese, butter, cream and yoghurt Ice cream, gelato, frozen yoghurt and ice blocks
Eggs (chicken and duck) Pre-packaged prepared meals marketed as ready-to-eat
Cereals, pasta and grains (rice, oats, flour, couscous) Hot food for takeaway (heated above ambient temperature)
Sugar, salt, spices, cooking oils, sauces and condiments Restaurant, cafe, dine-in and food court meals
Spreads (jam, honey, peanut butter, Vegemite) Carbonated drinks (soft drinks, energy drinks, flavoured carbonated water)
Canned and frozen fruit, vegetables and fish, plus canned and packaged soup Alcoholic beverages (beer, wine, spirits, ready-to-drink cocktails)
Plain still bottled water, tea, coffee and 100% non-carbonated fruit juice Flavoured milk, flavoured water and food supplied as catering

How GST On Food Works

The thing that surprises most people is that food works the opposite way to most other GST categories. With most goods and services, you assume GST applies unless told otherwise. With food, the starting point is the reverse. Food for human consumption is GST-free under section 38-2 of the GST Act, and it only becomes taxable if it matches one of the specific exclusions listed in Schedule 1.

Schedule 1 lists categories of food that are not GST-free even though they are still food for people to eat. These include confectionery, savoury snacks, biscuits, ice cream, prepared meals, hot takeaway food and restaurant meals. If your food does not appear on that list and is not caught by a related rule, it is GST-free.

The ATO ruling GSTR 2001/8 covers GST and food, including which items are GST-free and which are taxable. The ATO also publishes a detailed food list and a search tool you can use to check individual products, which we link to near the end of this guide. The food rules sit in Subdivision 38-A of the GST Act.

Common Food Items: Is There GST?

Here are plain answers to the questions people search for most.

Is There GST On Milk?

Plain unflavoured milk is GST-free, along with cream, cheese and eggs. Flavoured milk such as strawberry or chocolate milk is taxable, because it is treated as a flavoured beverage rather than basic food.

Is There GST On Meat?

Raw, fresh and frozen meat, poultry and seafood for human consumption are GST-free. This covers raw beef, chicken, lamb, fresh fish and prawns. The exception is prepared meals and hot cooked meat ready to eat, which are taxable.

Does Coffee Have GST?

Tea, coffee and malt are GST-free, including beans and instant preparations marketed principally as tea, coffee or malted beverages. The catch is the ready-to-drink rule. A prepared cafe coffee, or any tea or coffee sold ready to drink, is taxable.

Is Sugar GST-Free?

Yes. Cooking ingredients such as flour, sugar, pre-mixes and cake mixes are GST-free, as long as they do not contain taxable ingredients. The same applies to fats and oils for cooking, plus spices, sauces and condiments. Breakfast cereals are also GST-free.

Is There GST On Bread?

Bread and bread rolls are GST-free as long as they do not have a sweet filling or a sweet coating such as icing. A glaze is not considered a sweet coating, so a glazed roll can still be GST-free. Spreads for bread, including jam, honey and peanut butter, are also GST-free. The exception is when a bread roll is served as part of a restaurant meal, which makes it taxable.

Is There GST On Chocolate, Biscuits And Snacks?

These are the classic Schedule 1 exclusions, so they are taxable. Confectionery, savoury snacks, biscuits, cookies, wafers, rice crackers, ice cream and similar frozen confections all attract 10% GST.

Edge case: A plain muesli bar may be GST-free, but a chocolate-coated muesli bar is treated as confectionery and is taxable. Plain popcorn kernels are GST-free, but flavoured or pre-popped popcorn is taxable as a snack.

Is Infant Formula And Baby Food GST-Free?

Infant formula marketed principally for children up to 12 months, for example stages 1 and 2 formula products, is GST-free, along with baby food. Formula for children 12 months and over is taxable. The ATO clarified the infant formula classification in GSTD 2026/1, with transitional compliance running through to 30 June 2026.

GST On Drinks And Beverages

Beverages have their own rules within the food provisions. Some drinks are GST-free, but many are taxable. Here is how the common ones break down.

Is Bottled Water Taxable?

Plain still bottled water without additives is GST-free. Flavoured or carbonated water is taxable, because carbonated drinks, including flavoured carbonated water, are listed under Schedule 1. Water consumed on premises, such as a glass of water served as part of a meal in a venue, is taxable. You can read more about how the ATO treats GST-free items including water and food.

Fruit And Vegetable Juice: The 90% Rule

Juice classification comes down to how much actual juice the product contains. Non-carbonated fruit or vegetable juice is GST-free only if it consists of at least 90% juice by volume, under Item 12 of Schedule 2. Carbonated juice has a stricter test under Item 11; it must consist wholly of fruit or vegetable juice to be GST-free.

The labelling of a product is what indicates whether it crosses the 90% threshold. For example, a 100% reconstituted orange juice with no preservatives, no artificial colour and containing vitamin C consists of at least 90% fruit juice and is GST-free under Item 12.

One important point from the ATO determination on this topic, GSTD 2002/2: a juice consumed for medicinal reasons rather than to quench thirst or for nourishment is not a beverage at all, so it is taxable even if it contains 90% or more juice. Pure Aloe Vera juice labelled with a recommended dosage and medicinal benefits is an example. Adding lemon or another pure juice to a medicinal liquid does not change this.

Soft Drinks And Alcohol

Carbonated soft drinks, energy drinks and flavoured carbonated water are all taxable. Alcoholic beverages such as beer, wine, spirits and ready-to-drink cocktails are always taxable, whether served in a restaurant, sold in a bottle shop or included in a meal deal. Alcohol is also subject to excise duty on top of GST.

Why The Same Food Can Be GST-Free Or Taxable

The same item can switch from GST-free to taxable depending on where and how it is sold and consumed. This is the part that catches people out most often.

Foods that are prepared, cooked or consumed on the premises are typically taxable. Restaurants, cafes, snack bars, food courts, and sport, leisure and entertainment venues generally charge GST on all their food and beverage sales, because most of what they sell is prepared or ready to eat.

Example: If a cafe sells you a loaf of bread to take home, that sale may be GST-free. If the same cafe serves you toast with jam on a plate to eat in-store, it becomes taxable. The context of consumption is the deciding factor.

Hot Takeaway Versus Cold Food

Any food heated above ambient temperature for takeaway is taxable. A hot meat pie or a burger ready to eat attracts GST. Cold takeaway food, such as a pre-packed salad without dressing or a wrap for later, may be GST-free depending on how it is packaged and sold. If a takeaway item comes with utensils, is heated on-site, or is marketed as ready for immediate consumption, it will likely attract GST.

Example: Cold sushi from a takeaway shop is GST-free, but hot sushi is taxable.

How Marketing And Packaging Affect GST

The way a food item is marketed can change its GST status. Promotion, advertising, labelling, name, instructions, packaging, display and product placement all influence whether a food item is GST-free or taxable. Two products with similar contents can land on different sides of the line purely because of how they are presented and sold.

What Else Is GST-Free Besides Food?

Food is one of several GST-free categories. Water and sewerage services are also GST-free under Subdivision 38 of the GST Act. Other categories outside food, such as certain health, medical and education supplies, can be GST-free too, but the treatment of individual products in those areas depends on the specific rules that apply to them. If you are unsure about a particular health good or other non-food item, it is best to check the relevant ATO guidance or seek advice rather than assume.

It is worth remembering that not everything that looks like food is GST-free. Pet food and food that is not for human consumption are taxable.

GST-Free, Input Taxed And Taxable Supplies Explained

It helps to understand the three categories of supply, because they are treated very differently.

  • Taxable supplies: 10% GST applies. The business adds GST to the price, collects it and remits it to the ATO.
  • GST-free supplies: No GST is included in the price and the business does not collect or remit GST on the sale. Importantly, the business can still claim input tax credits for the GST it paid on related business purchases. GST-free supplies are governed by Division 38 of the GST Act.
  • Input taxed supplies: A different category again. No GST is charged on the sale, but the business generally cannot claim input tax credits on related purchases. This is the key difference from a GST-free supply.

Can Businesses Claim GST Credits On Food Purchases?

Yes. Even when a business sells GST-free food, it can still claim input tax credits for any GST it paid on related business purchases. This is one of the advantages of making GST-free supplies rather than input taxed supplies.

Example: A grocer sells fresh apples, which are GST-free, so it collects no GST on the sale. But if the grocer pays GST on packaging, refrigeration repairs or other business inputs, it can claim those GST amounts back as input tax credits on its BAS.

A separate point to be aware of is that some food and drink can be classed as entertainment. Where an expense is entertainment and no income tax deduction applies, the GST credit can also be limited. This is a common area where businesses get caught out, so it is worth confirming the treatment before claiming.

Mixed Supplies And Combination Foods

Not all food fits neatly into one category, and there are two situations to know about.

A combination food is treated as a single item. If the overall product is a combination of food where at least one part is taxable, the whole thing can be taxable. A snack pack that combines GST-free and taxable elements as one product is often treated this way.

A mixed supply is different. Here you are selling separately identifiable items together, and each item is classified on its own. A hamper or platter containing both GST-free and taxable goods is generally treated item by item, so GST applies only to the taxable components.

Because the line between the two can be fine, it pays to assess each product individually and consider how it is packaged, marketed and consumed.

GST And Your Food Business: Registration And BAS

If you run a food business, a few practical rules tie everything together. GST is 10%, and where a sale includes GST, the GST amount is 1/11th of the price.

You must register for GST if you are carrying on a business and your GST turnover is $75,000 or more. The threshold is $150,000 for non-profit organisations. GST turnover is your total business income from Australian sales, not your profit. You can read how the ATO explains how GST works and the registration threshold.

A couple of points that catch food businesses out: tips and service charges can be subject to GST if they are included on the invoice or receipt, rather than left voluntarily by the customer. The ATO also offers simplified accounting methods to help small food retailers estimate their GST at the end of each tax period, which can save a lot of time when you sell a mix of GST-free and taxable items.

Getting the classification right on your BAS matters. Charging GST on a GST-free item means you owe the ATO money you should not have collected. Failing to charge GST on a taxable supply means you have to pay it from your own pocket. Either way, a mistake costs you.

How To Check If A Food Item Has GST

If you are not sure about a specific product, go straight to the source. The ATO provides a GST food and beverage search tool and a detailed food list that let you check the GST status of individual items. You can browse the ATO GST-free food guidance for the official position. For an overview of the broader rules, the explanation of the rules for GST and food is also a useful plain-language summary.

For unusual or hard-to-classify products, it can be worth seeking advice or, in some cases, applying to the ATO for a private ruling so you have certainty before you set your prices.

Get Help With GST On Food

The headline rule is simple: basic food is GST-free, while prepared, hot, snack and restaurant food is taxable at 10%. The complications come from the edge cases, the premises and consumption test, the juice thresholds, combination foods and how marketing affects classification.

Getting it wrong costs money in both directions. Charge GST when you should not and you owe the ATO. Miss GST on a taxable supply and you pay it yourself. For a food business, those errors add up quickly and can flow through to your BAS and your pricing.

If you sell food or run a cafe, restaurant or grocery business and you want certainty about how GST applies to your products, we can review your range and your BAS treatment so you classify everything correctly from the start. Book a meeting with Tax Window and we will help you get it right.

Artur Osadchiy

About The Author: Artur Osadchiy

Artur is a Certified Practising Accountant with over 30 years’ experience working as a trusted advisor to 600+ clients across Australia. Based in Melbourne, he started Tax Window with his wife Marina in 2009 and leads the firm’s tax and accounting team. In his free time, Artur enjoys watching the AFL (go Kangas!) and spending time with family.

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