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Overview of GST on Food Products
Goods and Services Tax (GST) in India GST has significantly changed food product taxation. GST on food products varies by type, with slabs of 0% (basic staples like grains), 5% (branded cereals, dairy), 12% (processed foods), 18% (packaged snacks), and 28% (luxury items like chocolates). HSN codes are crucial for proper categorisation and tax compliance. In this article, we will explore the GST rates applicable to sugar, salt, chocolate, and spices in India, along with their respective HSN codes.
GST Rate for Sugar
What is the GST rate for sugar?
The current GST rate for sugar in India is 5%. This rate applies to all types of sugar, including cane sugar, beet sugar, and chemically pure sucrose in solid form. Whether you’re purchasing sugar cubes or granulated sugar, the GST on sugar remains consistent at 5%.
HSN Code for Sugar
Sugar falls under the HSN code 1701. This code is used for the classification of goods under the GST regime. When filing GST returns or preparing invoices, businesses must use the correct HSN code for sugar to ensure compliance with tax regulations.
Impact of GST on Sugar Prices
Before GST, sugar was subject to a Value Added Tax (VAT) of 5% in most states. Under GST, the tax rate on sugar has remained largely unchanged at 5%. However, the prices of sugar may have experienced a slight increase due to factors such as increased transportation costs and compliance requirements for sugar manufacturers and suppliers.
GST Rate for Salt
What is the GST rate for salt?
Salt, being an essential commodity, is exempt from GST. This means that there is no GST levied on the sale of salt in India. The GST rate for salt is effectively 0%.
HSN Code for Salt
The HSN code for salt is 2501. This code is used for the classification of salt under the GST system. Despite being exempt from GST, businesses dealing in salt must still mention the correct HSN code on their invoices and GST returns.
Why is salt exempt from GST?
The Indian government has exempted salt from GST to ensure that this essential commodity remains affordable for the masses. Salt is a basic necessity, and its exemption from GST helps in maintaining its accessibility to all sections of society.
GST Rate for Chocolate
What is the GST rate for chocolate?
The GST rate for chocolate depends on the type of chocolate being sold. Plain chocolate, which consists of cocoa butter, cocoa mass, and sugar, attracts a GST rate of 5%. Under the revised GST regime effective September 2025, the “premium / added-ingredient” chocolates (e.g. chocolates with nuts, fruits, wafers) no longer attract 28% — they now fall under the 5% GST slab.
Is there a difference in GST rates for dark, milk, and white chocolate?
As of September 2025, under the revised GST 2.0 structure, all types of chocolate – including dark, milk, and white chocolate -now fall under the 5% GST slab, replacing the earlier 18% and 28% rates.
HSN Code for Chocolate
The HSN code for chocolate is 1806. This code covers various chocolate preparations, including chocolate bars, chocolate confectionery, and chocolate spreads.
Impact of GST on Chocolate Prices
As of September 2025, the implementation of the revised GST 2.0 structure has reduced the GST rate on chocolates to 5%, leading to lower prices for consumers compared to the earlier 18% and 28% slabs. This has affected the affordability of chocolates, particularly for price-sensitive customers.
GST Rate for Spices
What is the GST rate for spices?
The GST rate for spices varies depending on the type of spice and its processing level. Whole spices, such as cumin seeds, coriander seeds, and black pepper, attract a GST rate of 5%. On the other hand, processed spices, including powdered spices and spice mixes, are subject to a higher GST rate of 5%.
Are all spices taxed at the same GST rate?
No, spices are taxed differently under GST: whole spices at 5% and processed spices at 12%, based on their processing level.
HSN Code for Spices
The HSN codes for spices range from 0904 to 0910. Each specific spice has its own unique HSN code within this range. For example, the HSN code for black pepper is 0904, while the code for turmeric is 0910.
Impact of GST on Spice Prices
GST has had a mixed impact on spice prices, with whole spices taxed at 5%, but processed spices facing a higher 12% rate, leading to price increases. This has affected both consumers and businesses involved in the spice trade.
Comparison Table: GST Rates for Sugar, Salt, Chocolate, and Spices
|
Product |
GST Rate |
HSN Code |
Remarks |
|---|---|---|---|
|
Sugar |
5% | 1701 |
Processed sugar |
|
Salt |
0% (exempt) | 2501 |
Exempt from GST |
|
Chocolate |
5% (all types, earlier 18% & 28% unified) | 1806 |
Depends on type |
|
Spices |
5% (both whole and processed) | 0904-0910 |
Whole vs. processed |
How to Calculate GST on Sugar, Salt, Chocolate, and Spices
To calculate the GST amount on sugar, salt, chocolate, and spices, you can use the following formula:
GST Amount = (Product Price × GST Rate) / 100
Let’s take a practical example for each product:
-
Sugar:
-
Product Price: ₹100
-
GST Rate: 5%
-
GST Amount = (100 × 5) / 100 = ₹5
-
-
Salt:
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Product Price: ₹50
-
GST Rate: 0%
-
GST Amount = (50 × 0) / 100 = ₹0
-
-
Chocolate:
-
Product Price: ₹200
-
GST Rate: 18%
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GST Amount = (200 × 18) / 100 = ₹36
-
-
Spices (Whole):
-
Product Price: ₹80
-
GST Rate: 5%
-
GST Amount = (80 × 5) / 100 = ₹4
-
Recent Updates on GST for Food Products
Some recent updates related to GST on food products include:
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The GST Council has recommended reducing the GST rate on certain food items, such as pickles, sauces, and preserved vegetables, from 12% to 5%.
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There have been discussions on bringing more food items under the zero GST bracket to make them more affordable for consumers.
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The government has been taking steps to simplify the GST compliance process for businesses dealing with food products to reduce their administrative burden.
Staying informed about updates helps businesses ensure tax compliance and adjust pricing and accounting practices.
Related Read: GST on Rice & Essentials
Frequently Asked Questions (FAQs)
1. How is the HSN code for sugar classified?
The HSN code for sugar is 1701, which falls under Chapter 17 of the GST tariff schedule.
2. Does the GST rate vary for raw sugar vs. refined sugar?
No, the GST on sugar is applicable at a uniform rate of 5% for all types of sugar, including raw and refined sugar.
3. Can the HSN code for sugar differ based on its form?
No, the HSN code for sugar remains the same (1701) regardless of its form, such as sugar cubes or granulated sugar.
4. What is the GST rate for imported sugar?
The GST rate for sugar remains the same at 5% for both domestically produced and imported sugar.
5. Are there any GST exemptions for sugar producers?
Currently, there are no specific GST exemptions for sugar producers in India.
6. Is GST applicable on packaged sugar and spices?
As of September 2025, GST is applicable on packaged sugar and spices at a uniform rate of 5%, following the revised GST 2.0 structure that replaced the earlier 5% and 12% slabs.
7. What is the GST rate for organic spices?
Organic spices – both whole and processed – now attract a uniform 5% GST rate, replacing the earlier 5% and 12% slabs.
8. Does GST apply to imported chocolates?
Imported chocolates are taxed at the same 5% GST rate as domestic chocolates, replacing the previous 18% and 28% rates.
