Now how much GST will be charged on pulses, flour, grains in packets weighing more than 25 kg, Business Hindi News

The recommendations made in the 47th meeting of the GST Council have come into effect from today. The changes related to GST rate have become effective from today i.e. July 18, 2022. Due to this change, there are a lot of questions regarding food items like pulses, flour, grains, etc. Like what changes have been made with respect to packaged and labeled commodities from July 18, 2022? Will GST be levied on packs larger than 25 kg? PIB has given answers to many such questions through a press release.

Unbranded, pre-packed and labeled food items such as packets of flour, pulses and cereals weighing more than 25 kg will be exempted from five per cent Goods and Services Tax (GST).

The Central Board of Indirect Taxes and Customs (CBIC) issued a series of questions and answers late on Sunday night, in which many doubts have been resolved and clarifications have been given. It was said in the ‘FAQ’ that five percent GST will be applicable only on pre-packed items whose weight is up to 25 kg. However, if a retail business brings 25 kg packaged goods from the manufacturer or distributor and sells it openly, then GST will not be charged on it.

Last week, the government had notified that from July 18, five per cent GST will be levied on unbranded and pre-packed and labeled food items. Earlier, GST was imposed only on branded goods. It said, “It is clarified that individual packets of cereals, pulses and flour weighing more than 25 kg/litre will not fall in the category of pre-packed and labeled goods and hence will not attract GST.”

Giving an example, CBIC has said that the supply of 25 kg packet of pre-packed flour for retail sale will attract GST, however, such a 30 kg packet will be outside the purview of GST. The board informed that GST will be applicable on the package which will contain multiple retail packs. He gave the example that a 50 kg package of rice would not be considered as pre-packed and labeled goods and would not attract GST.

Rajat Mohan, senior partner at AMRG & Associates, said that this tax will increase price-based inflation of basic food items like rice and cereals from today itself.