Government hikes the GST rate on many packaged food items | Fusion - WeRIndia

Government hikes the GST rate on many packaged food items

Government hikes the GST rate on many packaged food items

Recently, the GST council recommended increasing the tax rate on certain items. It has brought many daily essential items into the ambit of Goods and Service Tax. As a result, many items became costlier from July 18.

After the hike, single packages of food items attract 5 per cent GST. These include cereals, flours, and pulses weighing up to 25 kg. They are considered prepackaged and labelled goods.

There are many other prepackaged and labelled goods. Some of them are pre-packed curd, lassi, and buttermilk. These items were exempt from the GST in the past. But they have been brought under the ambit of GST.

That means unbranded prepackaged items were exempt from tax in the past. But, now all of them fall under the 5 per cent GST.


However, when the commodities are sold loose, they are exempt from the GST. The finance minister said that no GST is applicable on the items when they are sold loose.

Notably, many manufacturers were keeping their items unlabeled to evade tax.

As unlabeled items were exempt from the GST, they had been evading tax. Hence, the government decided to bring these unlabeled items into the ambit of tax.

The new rate of 5 per cent is applicable even on a package that contains 10 retail packs of flour, each with 10 kg of material.

Besides, the hospital room rent that exceeds ₹5,000 per day per patient will fall under 5 per cent GST. No input tax credit is available on the room rent. Earlier, it was exempt from the GST.  But, ICUs are excluded from the tax.

In addition to that, hotel rooms under ₹1,000 per day are also taxed at the rate of 12 per cent. These rooms were exempted from the tax earlier.

The GST on LED Lights and lamps and fixtures has been hiked from 12 per cent to 18 per cent.

Image from Pxhere (Free for commercial use / CC0 Public Domain)


Image Reference: https://pxhere.com/en/photo/1627198

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