All About GST on Food: GST Rate and Impact on Food Item

The GST regime was instituted by the Government of India from 1^st July 2017. GST (Goods and Services Tax) is an indirect tax charged on products and services that subsumed the previous tax structure which included service tax, excise duty, VAT (Value Added Tax), customs duty, surcharges, and so on.

Starting from luxury goods, home utilities, clothing to food items, every item as well as numerous services have been classified under the tax slabs of the GST regime. Before the implementation of GST, buyers had to pay VAT and service tax, whereas sellers had to pay excise duty and VAT, as applicable. Since GST has replaced the previous structure, it is essential for both buyers and sellers to have a proper idea about this new taxation regime. Online tools like GST calculator assists Indians to assess the tax applicable on various goods and services. Also, there are customised tools such as GST calculator for wholesalers and retailers to make the process further easy.

Impact of GST on food items

All food items have been arranged on the tax slab as applicable. However, alcoholic beverages are an exception in this case. GST is charged on alcohol but only as a service of providing in case of restaurants. Restaurants which sell food and alcoholic beverages charge GST as per the services provided on both food and beverages served or provided. Applicable tax ranges from 0% to 18%.

0% tax chargeable on the following food items –

• Pasteurised/unpasteurised unsweetened milk and cream.
• Fresh vegetables, including onions, garlic, potatoes, etc.
• Unpackaged meat.
• Container packed vegetables.
• Fresh grapes, coconut, apples, bananas, etc.
• Non-packed leguminous vegetables.
• Fresh/cooked/preserved bird’s eggs.

5% GST on the following edible items –

• Packed meat.
• Dried leguminous vegetables that are packed.
• Ginger, turmeric, bay leaves, curry leaves, etc.
• Powder of dried leguminous vegetables.

12% tax on the following –

• Preserved fruits, vegetables and nuts with sugar.
• Preserved fruits, vegetables and nuts with vinegar.

18% GST on the following food items –

• Chocolates and other products made of cocoa.
• Food items made using flour, malt extract that contains cocoa (not more than 40% of its net weight.)

GST implementation also directs the restaurants to levy the following tariff as applicable –

1. 5% GST collected on food services are as follows –

• GST charged on food services from air-conditioned as well as non-AC restaurants.
• Tax on room services, takeaways of charges less than Rs. 7500.
• Non-alcoholic food and drink served at the cafeteria, canteen etc.
• Meals served by Indian Railways.

1. 18% GST levied on the following food services-

• Restaurant services including room service, takeaways above Rs. 7500.
• Outdoor catering services.
• Food services like that of a club, guest house, etc.

To levy GST, all product and service providing bodies have to register for GST online or offline. Apart from food items and restaurant tariffs, GST has also brought changes in the service sector, banking sector, etc.

Before the implementation of the GST regime, taxes levied on disbursals of personal loans, business loans, etc. were that of service tax on the processing and prepayment fee. Now, a standard GST charge is to be applied on the loan disbursals. Lending houses have the responsibility to explain the borrower in details of the tax to be levied. A GST calculator also helps to calculate tax rates as applicable.

GST rates are, however, subject to changes. The GST Council (chaired by Union Finance Minister) has the task of fixing, regulating and implementing GST rates. Whether you are an individual or a business entity, paying you GST is mandatory.

How to FInd GSTIN Number For Tax Paying

The goods and services tax number, or GST number to be specific, is a 15 digit number which proves important for every Indian taxpayer. This number becomes an exclusive identity of a business, LLP, a partnership firm or a proprietorship company.

Also known as GSTIN, it can be found by its name. You can now look up the GST number of your business organisation by fully typing the name or with its initial letters.

The number is found with the name as each and every GST number gets shared with the Central Government. To know How to get a GST registration number for a new business, read below.

Check out these steps by which you can look up your GST number by typing the name :

1. Enter the correct name of your business mentioned in the PAN card. Make sure you do not leave any typing error.
2. Type a minimum of 10 characters so that you find relevant information related to your GST number.
3. To find the most relevant answer, enter the initials of your state along with the characters of your company name.

[For example, if you want to find goods and services tax number of Indian railway in Maharashtra, then type Indian Railway Maharashtra.]