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India is one of the largest producers and consumers of tea in the world. From morning chai to herbal infusions, tea is a daily essential for many. But how is tea taxed under GST? This guide explains the gst on tea, whether loose, branded, green, or herbal.
The Goods and Services Tax (GST) system classifies tea based on its form (loose, packaged) and type (black, green, herbal). The standard GST rate on tea is:
| Type of Tea | HSN Code | GST Rate |
|---|---|---|
| Loose tea (unbranded) | 0902 | 0% (Exempt) |
| Branded/packaged tea | 0902 | 5% |
| Tea bags (black/green) | 0902 | 5% |
| Instant tea mix | 2101 | 18% |
| Herbal or medicinal teas | 2106 | 12% or 18% |
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The tea powder gst rate is the same as regular packaged tea:
Even high-quality loose-leaf teas are exempt if sold unpackaged and unbranded.
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| Product | GST Rate |
|---|---|
| Herbal infusion (without medicinal claim) | 5% or 12% |
| Ayurvedic/medicinal tea (under Ayurveda license) | 12% or 18% |
Businesses can claim Input Tax Credit if selling taxable tea products.
Understanding the gst on tea helps buyers choose better and sellers price fairly. Whether you enjoy a basic brew or a premium blend, GST plays a role in every cup.
BUSY is a simple, yet powerful GST / VAT compliant Business Accounting Software that has everything you need to grow your business.