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Next-Gen GST Overhaul: Staple Foods Tax-Free, Processed Foods at 5% from Sept 22

  • 09 Sep 2025
  • 616 Views

In GST Council’s 56th meeting, held on 3 September 2025, recommendations were made for making changes in GST tax rates, offering relief to individuals, common man, aspirational middle class and measures for facilitation of trade in GST. The reduced GST rates will come into effect from 22 September 2025 onwards.

In Annexure I, the major processed food products on which GST rates have been reduced are contained. 

Annexure I

Here is a list of major processed food products that will be subject to reduced GST rates:

S No

Product Description

GST (%)

From

To

1

Ultra-High Temperature (UHT) milk

5%

Nil

2

Condensed milk

12%

5%

3

Almonds

12%

5%

4

Malt, whether or not roasted

18%

5%

5

Sugar boiled confectionery

12%

5%

6

Sugar confectionery

18%

5%

7

Cocoa butter, fat and oil and Cocoa powder

18%

5%

8

Chocolates and other food preparations containing cocoa

18%

5%

9

Pasta, whether or not cooked or stuffed (with meat or other substances) or otherwise prepared, such as spaghetti, macaroni, noodles, lasagne, gnocchi, ravioli, cannelloni; couscous

12%

5%

10

Pastry, cakes, biscuits and other bakers’ wares, whether or not containing cocoa; communion wafers, empty cachets of a kind suitable for pharmaceutical use, sealing wafers, rice paper and similar products

18%

5%

11

Extruded or expanded products, savoury or salted

12%

5%

12

Vegetables, fruit, nuts and other edible parts of plants, prepared or preserved by vinegar or acetic acid

12%

5%

13

Jams, fruit jellies, marmalades, fruit or nut purée and fruit or nut pastes

12%

5%

14

Fruit or nut juices (including grape must) and vegetable juices

12%

5%

15

Soups and broths and preparations therefor; homogenised composite food preparations

18%

5%

16

Ice cream and other edible ice, whether or not containing cocoa

18%

5%

17

Namkeens, bhujia, mixture, chabena and similar edible preparations

12%

5%

18

Plant-based milk drinks, ready for direct consumption as beverages

18%

5%

19

Soya milk drinks

12%

5%

20

Fruit pulp or fruit juice based drinks (other than Carbonated Beverages of Fruit Drink or Carbonated Beverages with Fruit Juice)

12%

5%

 

GST Rate Rationalization’s Benefits

Benefits associated with GST rate rationalization are as follows:

  • It offers a simplified tax structure.

  • It has introduced reduced prices for most food items, making them more affordable for individuals. 

  • The lower prices will increase demand for the food items, investment expansion and employment generation.

  • Similar goods and items will be subject to the same rate slab. This will reduce disputes and litigation costs.

Analysis

The GST structure has been reduced from four slabs (5%, 12%, 18%, 28%) to two main rates - 5% (merit rate) and 18% (standard rate) along with 40% tax rate for sin/luxury items. These changes will become effective in just a few weeks from now. 

The food-processing sector will benefit significantly from this rationalization as most products will now fall under the 5% GST slab. This adjustment presents several advantages that can stimulate the sector as well as encourage economic growth of India.

 

Source: Press Information Bureau

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