Fresh, pasteurized, and unpackaged milk is primarily exempt from GST (0% rate) to make it affordable. In some contexts, it may also be classified under nil-rated supplies (0% tax), but it generally falls into the category of essential exempt goods, meaning no Input Tax Credit (ITC) can be claimed by suppliers.
Exceptions that are zero rated include milk and milk drinks, tea, maté, herbal tea, coffee and cocoa, preparations of yeast, meat and egg. Potato crisps roasted or salted nuts and various other savoury snack products. Products for home brewing and wine making.
NIL Rated supply is referred in the definition of 'exempt supply' and it refers to supply of any goods or services or both which attracts nil rate of tax. In other words, the supply of such goods/services which are leviable to GST at NIL rates i.e. 0% as per the tariff schedule is called 'nil rated supply'.
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.
From September 22, 2025, fresh and pasteurised milk remain fully exempt from GST. Pre-packaged items such as UHT milk, paneer, and curd are also exempt, benefiting consumers with zero tax on these products. However, dairy products like butter, ghee, cheese, and similar items attract a reduced GST rate of 5%.
Generally, basic foodstuffs are GST-free, while prepared meals, snacks, and beverages are taxable. The ATO's detailed GST-free food list outlines three broad categories: Unprocessed or minimally processed foods: This includes fresh fruits and vegetables, meat, poultry, fish, eggs, and milk.
Cereals, edible fruits and vegetables (not frozen or processed), edible roots and tubers, fish and meat (not packaged or processed), tender coconut, jaggery, tea leaves (not processed), coffee beans (not roasted), seeds, ginger, turmeric, betel leaves, papad, flour, curd, lassi, buttermilk, milk, and aquatic feeds, and ...
The GST/HST break includes certain qualifying goods, such as:
4. Are there any exemptions under GST for certain categories of rice? Paddy, the raw form of rice, is exempt from GST. However, once the paddy is processed into rice, the 5% GST rate applies.
California
The reduced rate of 4,8% is for especially for agriculture: including greyhounds, livestock and the hire of horses. The zero rate is for all exports, tea, milk, coffee, books, breaed, children's clothes and shoes, medicine, fertilisers, vegetable seeds and fruit trees and large animal feed.
Whilst coffee products used to prepare coffee, for example, instant coffee or ground/whole beans are zero-rated, coffee purchased as a hot drink from a café, restaurant or similar establishment, is subject to VAT at the standard rate of 20%.
Milk and dairy products are essential everyday items in India. The latest GST reforms (called GST 2.0) have made the tax system easier by reducing GST rates on many value-added dairy products. Earlier, some of these items were taxed at 12% or 18%, but now they fall under the 5% or even 0% (exempt) category.
Only Grade A milk is regulated under federal milk marketing orders. Grade B milk (also referred to as manufacturing grade milk) does not meet fluid grade standards and can only be used in cheese, butter and nonfat dry milk.
The HSN code for milk nil rated is 04011010. Milk is exempt from GST in India.
Zero-Rated Supplies: These goods and services are subject to a 0% GST/HST rate, meaning that businesses involved in providing these goods or services can still claim input tax credits (ITCs) on the GST/HST they paid related to those supplies. Exempt Supplies: These goods and services are not subject to GST/HST at all.
Zero rating makes the supplies cheaper as tax chargeable is zero while Input Tax is claimable. What is the difference between zero rated and exempt supplies? Exempt supplies are not taxable and are therefore different from zero rated supplies in which the supplier is entitled to Input tax deduction.
📝 Overview of Schedule – Nil Rated (0% GST)
These typically consist of essential commodities like fresh fruits, vegetables, grains, salt, and educational materials. By assigning a zero tax rate, the government ensures these basic items remain affordable for all, supporting low-income groups and public welfare.
Zero-rated supplies
Fresh milk, curd, lassi, paneer (unbranded) Unbranded wheat, rice, pulses, vegetables, fruits Fresh fish, meat, eggs Unbranded honey, coconut, coconut water Unbranded dry fruits and edible oils Simple understanding: This is a basic food of daily use, hence the government has not imposed GST on it.
These zero-rated items ensure that Canadians of all income levels can access the essentials without an added tax burden. Non-taxable grocery items include: Dairy products (milk, cheese, yogurt) Fresh and frozen vegetables.
Currently, there are 21 food items in the zero-rated basket: brown bread, maize meal, rice, maize meal, vegetables, samp, fruit, mealie rice, vegetable oil, dried mealies, milk, dried beans, cultured milk, lentils, brown wheaten meal, pilchards/sardines in tins, eggs, milk powder, edible legumes, dairy powder blend and ...