21st August 2017
Good and service tax regime is one of biggest taxation reforms in the history of Indian economy. This regime has drastically affected the grocery bills of all households. The grocery bill includes various essential items like fruits, vegetables, milk products etc. In the era of inflation one of the biggest concerns of the homemakers is the day by day increasing bill of their grocery items.
Under the GST regime, the tax rate on most of the essential commodities has been reduced by the government. While most of the essential groceries have been placed under low tax slabs, the same cannot be said for processed foods and most items containing sucrose.
There are four tax slabs of 5, 12, 18 and 28 per cent slabs under the GST regime. The GST Council has placed all the goods under these slabs.
Under the earlier taxation regime, some of the grocery items were excluded from the purview of any kind of taxation. This provision of exemption is continued in the GST regime also. Some of the goods which are nil rated under the GST regime includes the following-
• Fruits and vegetables
• Atta Pulses
• Packed curd
Further, under the GST regime, the tax rate on most of the goods has been reduced by the GST Council which will make them cheaper. Items which will become cheaper under GST regime due to reduced tax rates are as follows-
Item Tax rate pre- GST GST Rate
1. Packed coffee/tea 10.29% 5%
2. Spices 9.09% 5%
3. Packed Curd 8.7% 0%
4. Packed Paneer 9.17% 5%
5. Cheese 13.64% 12%
6. Ice-cream 25% 18%
7. Biscuit 25% 12%
8. Chocolates 33.33% 28%
9. Cornflakes 32.74% 18%
10. Juices 15.38% 12%
However, the rate of taxes on packed food has been increased significantly under this regime. Also, there are some other items on which TAX rate has been increased. Following are the items on which the tax rate has been increased-
Item Tax rate pre-GST GST rate
1. Packaged Chicken 9.03% 12%
2. Edible oil 16.82% 18%
3. Butter 6.38% 12%
4. Bhujia 9.03% 12%
Thus, Good and Service tax is a mixed bag of good and bad for the Grocery items.
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