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Ghee is a staple in Indian households, used in cooking, religious rituals, and Ayurvedic medicine. But when it comes to pricing and taxation, many are unsure about the GST impact. Whether you’re a buyer or a dairy business, understanding the gst on ghee helps with pricing and compliance.
Ghee, also known as clarified butter, is made by simmering butter to remove water and milk solids. It is:
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The gst rate on ghee is:
Yes, you read that right—there is no GST exemption for loose or unbranded ghee. All ghee, whether sold in small sachets or large tins, is taxed at a flat 12% GST rate.
| Ghee Type | HSN Code | GST Rate |
|---|---|---|
| Branded ghee (any pack size) | 0405 | 12% |
| Loose/desi ghee sold by weight | 0405 | 12% |
| Ghee sold by dairies/co-ops | 0405 | 12% |
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Desi ghee, whether made from cow milk or buffalo milk, is not exempt from GST.
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Since ghee attracts 12% GST, the final price includes this tax—especially for consumers buying packaged goods. For businesses, Input Tax Credit (ITC) helps reduce net tax liability.
Businesses can claim that ₹12 as input credit if the ghee is used for resale or production.
Knowing how gst on ghee is calculated helps both buyers and sellers stay tax-compliant. Whether you’re buying branded packets or selling loose ghee, remember—the GST rate remains the same at 12%.
BUSY is a simple, yet powerful GST / VAT compliant Business Accounting Software that has everything you need to grow your business.