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New Delhi: The GST Council on September 3, 2025 recommended two-rate tax structure and changes in existing GST tax rates to provide relief to individuals. The reduced GST rates will be effective from September 22, 2025.
The Union Finance Ministry has stated that the GST rate rationalisation will not only help in creating a simplified tax structure, reduce prices for almost all food products thus promoting ease of living. The rate cut will also increase demand for food products, expansion of investment, and employment generation.
The Goods and Services Tax (GST) Council in its 56th meeting on September 3, 2025 recommended eliminating the GST structure from four slabs - 5%, 12%, 18%, 28% to two main rates - 5% (merit rate) and 18% (standard rate). However, it has been recommended that a 40% GST would be applicable on sin/luxury goods.
The food-processing sector has been a major beneficiary in this rationalization of tax rates with most products witnessing a decline to 5% GST slab.
This rationalisation of GST to lower levels provides a variety of stimulants to the sector and encourage a virtuous cycle of economic growth through following:
Processed food products on which GST rates have been reduced are as follows:
| S.No | Products | Old GST rates | New GST rates |
|---|---|---|---|
| 1 | Ultra-High Temperature (UHT) milk | 5.00% | Nil |
| 2 | Condensed milk | 12.00% | 5.00% |
| 3 | Almonds | 12.00% | 5.00% |
| 4 | Malt, whether or not roasted | 18.00% | 5.00% |
| 5 | Sugar boiled confectionery | 12.00% | 5.00% |
| 6 | Sugar confectionery | 18.00% | 5.00% |
| 7 | Cocoa butter, fat and oil and Cocoa powder | 18.00% | 5.00% |
| 8 | Chocolates and other food preparations containing cocoa | 18.00% | 5.00% |
| 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 | 12.00% | 5.00% |
| 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 | 18.00% | 5.00% |
| 11 | Extruded or expanded products, savoury or salted | 12.00% | 5.00% |
| 12 | Vegetables, fruit, nuts and other edible parts of plants, prepared or preserved by vinegar or acetic acid | 12.00% | 5.00% |
| 13 | Jams, fruit jellies, marmalades, fruit or nut purée and fruit or nut pastes | 12.00% | 5.00% |
| 14 | Fruit or nut juices (including grape must) and vegetable juices | 12.00% | 5.00% |
| 15 | Soups and broths and preparations therefor; homogenised composite food preparations | 18.00% | 5.00% |
| 16 | Ice cream and other edible ice, whether or not containing cocoa | 18.00% | 5.00% |
| 17 | Namkeens, bhujia, mixture, chabena and similar edible preparations | 12.00% | 5.00% |
| 18 | Plant-based milk drinks, ready for direct consumption as beverages | 18.00% | 5.00% |
| 19 | Soya milk drinks | 12.00% | 5.00% |
| 20 | Fruit pulp or fruit juice based drinks (other than Carbonated Beverages of Fruit Drink or Carbonated Beverages with Fruit Juice) | 12.00% | 5.00% |
