New GST on Tea: Loose, Branded, and Packaged Types
- Loose, unbranded tea in India is exempt from GST, while branded or packaged tea is taxed at 5%.
- Tea bags, whether black or green, and herbal teas are taxed at 5%, but instant tea mix is taxed at 18%.
- Herbal teas have varying GST rates from 5% to 18%, depending on their medicinal claims.
- Input Tax Credit can be claimed by tea businesses for costs like packaging and logistics when selling taxable tea products.
- Understanding GST on tea helps consumers make informed choices and ensures fair pricing by sellers.
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.
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New GST Rate on Tea in India
The Government of India is updating GST rates effective after 22 Sep 2025. Below are the expected new GST rates for tea (no compensation cess).
New GST Rate on Tea
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 | New 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 | 5% or 18% |
Type of Tea
HSN Code
New GST Rate
Type of Tea
HSN Code
New GST Rate
Type of Tea
HSN Code
New GST Rate
Type of Tea
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New GST Rate
Type of Tea
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Old GST Rate on Tea in India
(Old GST Rates – Applicable Until 21st September)
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% |
Type of Tea
HSN Code
GST Rate
Type of Tea
HSN Code
GST Rate
Type of Tea
HSN Code
GST Rate
Type of Tea
HSN Code
GST Rate
Type of Tea
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Loose vs Branded Tea: What’s the Difference?
- Loose tea (sold without packaging or label): GST exempt (0%)
- Branded and pre-packaged tea: 5% GST
- Tea in unit containers with brand name or label: Treated as branded
Tea Powder GST Rate
The tea powder gst rate is the same as regular packaged tea:
- If branded/packaged: 5%
- If sold loose/unbranded: 0%
GST on Tea Leaves
- Loose, unbranded tea leaves: 0% GST
- Branded or packaged tea leaves: 5% GST
Even high-quality loose-leaf teas are exempt if sold unpackaged and unbranded.
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Green Tea GST Rate
- Branded/packaged green tea: 5% GST
- Loose green tea (unbranded): 0% GST
GST on Herbal Tea
| Product | GST Rate |
|---|---|
| Herbal infusion (without medicinal claim) | 5% or 12% |
| Ayurvedic/medicinal tea (under Ayurveda license) | 12% or 18% |
Product
GST Rate
Product
GST Rate
Input Tax Credit for Tea Businesses
- Packaging materials
- Logistics and freight
- Marketing services
- Equipment used in blending or manufacturing
Businesses can claim Input Tax Credit if selling taxable tea products.
Conclusion
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.
