Government has decided to levy a 5% Goods and Services Tax (GST) rates on unregistered packaged food. As a group of ministers (GoM) has decided to remove exemption for packaged food items, if sold under unregistered brands.
The move is in the wake of misuse of the exemption for unbranded food by a section of the food processing industry, including rice and wheat millers.
“No tax waiver will be allowed for food items where brands are used but purportedly not being claimed,” the source said. The recommendation will be considered by the next GST Council meeting on 28th June. Now these items will be taxed at 5%, the rate for branded food.
The GoM has also decided to seek more time from the GST Council to finalise its main report concerning restructuring of the GST slabs.