GST on Food Items in India: What’s Taxable and What’s Not
Quick Summary
- Unpackaged and unbranded staples like wheat and rice attract 0% GST.
- Packaged and branded food items are now taxed at 0% GST (earlier 5%).
- Processed and preserved foods attract 5% or 18% GST, depending on the product category.
- Restaurant food, including AC, non-AC, and takeaway services, is taxed at 5% GST (without ITC).
- Outdoor catering services attract 18% GST (with ITC).
- Luxury food items such as chocolates and frozen pizza are taxed at 18% GST.
- Fresh fruits and vegetables are exempt from GST.
Food taxation under GST depends on packaging, branding, processing level, and service type. Let’s break it down in detail and understand the food gst rate.
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New GST Rates on Food Items
The Government of India revised GST applicability on select packaged food items effective 22 September 2025. Food products continue to fall under multiple slabs: 0%, 5%, and 18%, depending on classification.
GST on Food Items
| Food Type | GST Rate (After 22 Sept 2025) |
GST Rate (Before 22 Sept 2025) |
|---|---|---|
| Unpackaged, unbranded staples (wheat, rice) | 0% | 0% |
| Packaged and branded food (flour, rice) | 0% | 5% |
| Processed and preserved foods | 5% or 18% | 5% |
| Restaurant food (non-AC) | 5% | 5% |
| Restaurant food (AC) / takeaway | 5% | 5% |
| Luxury food items (chocolates, frozen pizza) | 18% | 18% |
(After 22 Sept 2025) 0%
(Before 22 Sept 2025) 0%
(After 22 Sept 2025) 0%
(Before 22 Sept 2025) 5%
(After 22 Sept 2025) 5% or 18%
(Before 22 Sept 2025) 5%
(After 22 Sept 2025) 5%
(Before 22 Sept 2025) 5%
(After 22 Sept 2025) 5%
(Before 22 Sept 2025) 5%
(After 22 Sept 2025) 18%
(Before 22 Sept 2025) 18%
HSN Codes for Common Food Categories Under GST
HSN (Harmonized System of Nomenclature) codes help classify food items under GST.
| Food Category | Common HSN Code |
|---|---|
| Rice, Wheat, Pulses | 1006, 1001, 0713 |
| Flour, Besan, Maida | 1101, 1106 |
| Dairy (Milk, Curd, Paneer) | 0401, 0403, 0406 |
| Dairy fats (Butter, Ghee, Cheese) | 0405, 0406 |
| Frozen & Ready-to-Eat Foods | 1604, 2106 |
| Sweets & Bakery Items | 1704, 1905 |
| Indian Breads | 1905 or 2106 |
| Chocolates & Cocoa Products | 1806 |
Loose, non-packaged staples are generally taxed at 0%, while pre-packaged and labelled items typically fall under 5%, unless otherwise notified.
Packaged vs Unpackaged Food: Key GST Differences
One of the most important GST distinctions is based on packaging and branding.
Unpackaged and unbranded food: 0% GST
Packaged and branded food: 0% GST (previously 5%)
Example:
- Loose atta = 0% GST
- Branded atta in sealed pack = 0% GST (earlier 5%)
This policy aims to maintain affordability for essential goods while regulating commercial-scale packaged items.
GST on Restaurant and Catering Services
Restaurant taxation under GST is service-based rather than product-based.
| Restaurant Type | GST Rate | ITC Availability |
|---|---|---|
| Non-AC Restaurants | 5% | Not Available |
| AC Restaurants & Takeaway | 5% | Not Available |
| Outdoor Catering | 18% | Available |
Even when ordering through food delivery platforms, GST at 5% is included in the food bill. Delivery or service charges may attract 18% GST separately.
GST on Bakery, Sweets, and Confectionery Items
- Plain unbranded bread = 0%
- Branded cakes and muffins = 5%
- Packaged biscuits = 18%
- Chocolates = 18%
Sweets sold by sweet shops typically attract 5% GST. However, if served as part of restaurant dining in an AC setup, applicable restaurant GST rules apply.
How to Calculate GST on Food Items
Understanding GST calculation helps both consumers and businesses.
GST Calculation
GST Amount = (Product Price × GST Rate) ÷ 100
Final Price = Product Price + GST Amount
Example 1: Packaged Biscuit (18% GST)
Product Price = ₹100
GST = (100 × 18) ÷ 100 = ₹18
Final Price = ₹118
Example 2: Restaurant Bill (5% GST)
Food Bill = ₹1,000
GST = (1,000 × 5) ÷ 100 = ₹50
Total Bill = ₹1,050
Example 3: Outdoor Catering (18% GST)
Catering Service = ₹50,000
GST = (50,000 × 18) ÷ 100 = ₹9,000
Total Amount = ₹59,000
For businesses registered under GST, Input Tax Credit may apply in eligible categories like catering services.
Why GST Compliance Matters for Food Businesses
Food businesses must ensure:
- Correct HSN code classification
- Accurate GST billing
- Proper stock and expiry tracking
- Timely GST return filing
Using accounting software designed for the food industry helps avoid compliance errors and improves operational efficiency.
Conclusion
GST on food items in India balances affordability and structured taxation. Essentials remain exempt, while processed and luxury items fall into higher slabs. Whether purchasing groceries or dining out, understanding GST rates ensures transparency in pricing.
For businesses, proper GST classification, billing, and compliance are essential for smooth operations.
