Sugar is a common ingredient in every Indian kitchen and a major component in food processing industries. But how does GST affect its pricing? Whether you’re a consumer, retailer, or in the food business, knowing the gst on sugar helps you stay informed and compliant.
The Government of India is updating GST rates effective after 22 Sep 2025. Below are the expected new GST rates for sugar and jaggery (no compensation cess).
Item | HSN Code | New GST Rate |
---|---|---|
Sugar (raw / white refined) | 1701 | 5% |
Jaggery (gur) – loose / unbranded | 1701 | 0% (Exempt) |
Jaggery (gur) – pre-packaged & labelled | 1701 | 5% |
Sugar substitutes / artificial sweeteners* | Varies | 18% |
Note: Under the two-tier structure (5% / 18%), sugar remains at 5% while most sweeteners classify at 18%. *HSN for sweeteners depends on composition (e.g., chemical/artificial vs plant extracts). Final rates apply as per government notification.
Type of Sugar | HSN Code | GST Rate |
---|---|---|
Raw sugar | 1701 | 5% |
White refined sugar | 1701 | 5% |
Processed sugar (packaged and branded) | 1701 | 5% |
Jaggery (gur) – not branded | 1701 | Exempt (0%) |
Jaggery (branded & packaged) | 1701 | 5% |
Sugar (HSN 1701) is uniformly taxed at 5%; jaggery (gur) is exempt if loose/unbranded and 5% when pre-packaged & labelled.
Product | GST Rate |
---|---|
Sugar (all types) | 5% |
Jaggery (loose) | 0% (Exempt) |
Jaggery (branded) | 5% |
Sugar substitutes (aspartame, sucralose, stevia etc.) | 18% |
Classification tip: Artificial/chemical sweeteners are typically taxed at 18%; plant-based extracts can vary by composition. Use the precise HSN on the invoice.
Sugar is taxed under the Goods and Services Tax (GST) system based on its form—raw or processed.
Type of Sugar HSN Code GST Rate |
---|
Raw sugar 1701 5% |
White refined sugar 1701 5% |
Processed sugar (packaged and branded) 1701 5% |
Jaggery (gur) – not branded 1701 Exempt |
Jaggery (branded & packaged) 1701 5% |
The standard gst rate on sugar is 5%, which applies to both loose and packaged sugar unless specifically exempted.
Get a Free Trial – Best Accounting Software For Small Business
Get a Free Trial – Best GST Accounting Software For Small Business
If you’re in the food or beverage industry, sugar is treated as a raw material. You pay 5% GST and can claim Input Tax Credit on it if registered.
For example, biscuit makers, juice producers, and sweet shops using sugar can offset this tax.
Get a Free Demo – Best Billing and Invoicing Software
Product | GST Rate |
---|---|
Sugar (all types) | 5% |
Jaggery (loose) | 0% (Exempt) |
Jaggery (branded) | 5% |
Sugar substitutes (aspartame, sucralose, stevia) | 18% |
So if you’re a diabetic or health-conscious buyer opting for substitutes, be aware of the higher tax.
Understanding how gst on sugar works helps not just households but also traders, manufacturers, and food businesses handle costs better and follow the right billing practices.