No, GST is not applied to all food. In many jurisdictions like India and Australia, essential, unprocessed, and raw food items (e.g., fresh fruits, vegetables, milk, rice, wheat) are generally exempt or have 0% GST. However, GST applies to packaged, branded, processed, and restaurant-prepared foods.
The highest rate of GST applicable in the food segment is 28%, which is applicable to certain goods such as caffeinated and carbonated beverages. Are there any food items with a nil charge of GST? Yes, there are food items such as fresh fruits, fresh vegetables, meat, fish, etc. that fall under the Nil rate of GST.
GST-Free Items:
Examples of food and beverages that are zero-rated as basic groceries under section 1 of Part III of Schedule VI include fresh, frozen, canned and vacuum sealed fruits and vegetables, breakfast cereals, most milk products, fresh meat, poultry and fish, eggs and coffee beans.
The majority of food items fall under the 5% GST slab. However, under the GST 2.0 reform, restaurants within hotels are now classified as 'specified premises' and are subject to 18% GST.
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GST on fresh vegetables is 0% unless they are branded and packaged. Frozen vegetables attract 5% GST if branded. GST on dehydrated vegetables is typically 5%, but it may go higher if mixed with other ingredients.
Examples of GST-free food items are:
Milk, cream, cheese and eggs. Spices and sauces. Fruit juice containing at least 90% by volume of juice (unless it is to be consumed at an event, or on the premises) Bottled drinking water (unless it is to be consumed at an event, or on the premises)
Fresh milk and pasteurized milk are fully exempt from GST. Further, milk products like curd, lassi, buttermilk, and paneer also are exempt from GST if sold in form apart from those pre-packaged and labeled.
All our prices are inclusive of GST.
Basic raw agricultural products, such as unroasted coffee beans or unprocessed tea leaves are exempt from GST (0% tax slab). Other forms like packaged, flavoured, or instant varieties attract a higher GST rate of 5%, 12%, or even 18% depending on their classification.
Charging GST Correctly: A Breakdown of Your Sales
Barista-Made Drinks: You must charge 10% GST on all hot and cold drinks prepared by your staff. This includes every coffee, tea, hot chocolate, and chai you sell.
Fresh eggs are exempt from GST (0%) under Chapter 4, as they are classified as unprocessed food products. However, processed or powdered eggs may attract 5% GST, depending on their use and packaging.
However, producers of ice cream have to pay GST at 18% on ice cream. So, GST rate does not depend on branding in case of ice creams. Restaurants registered under composition scheme may be able to sell the ice cream made by it at 5%.
UHT milk and packed paneer are now 0% GST, while ghee and cheese are 5%. Stay updated on dairy tax reforms. Major GST 2.0 Update (2026): Significant savings are now available. Essential dairy products such as UHT milk and packaged paneer are exempt from GST, while the GST rate on ghee and cheese has been reduced to 5%.
Foods That Are Surprisingly Exempt
These typically include: Fresh produce like fruits, vegetables, and herbs. Bread varieties without fancy modifications like icing. Dairy staples such as milk, cheese, and natural butter.
GST on Water and related products @ 12%
Branded tender coconut water when put up in a container. Lemonade. Aerated water.
Plain, unbranded bread is classified under HSN Code 1905 90 10 and is exempt from GST. Cakes, pastries, and sweet biscuits fall under HSN Code 1905 and attract 18% GST. Rusks and toasted bread fall under HSN Code 1905 40 00 and attract 5% GST.
Examples of GST-free foods
cooking ingredients, such as flour, sugar and baking mixes that don't contain any taxable ingredients. dry preparations marketed for the purpose of flavouring milk. fats and oils marketed for culinary purposes. unflavoured milk, cream, cheese and eggs.
Sales that do not include GST in their price are known as GST-free sales. In contrast, sales that have GST included in their price are known as 'taxable sales'. Examples of items that are GST-free include: basic food, such as fruits, vegetables, meat, fish and eggs.
What is the GST for sugar? In India, the GST rate for sugar, including varieties like brown sugar and items such as artificial honey, is set at 5%. This reduced rate applies to essential sugar products, helping to keep them affordable for consumers.