Quick Summary
The Indian Beverage Association (IBA) has appealed to the GST Council to reclassify aerated beverages from the current 'sin/demerit' category to the "food/merit" category, placing them under the 18% GST slab instead of the existing 40% tax burden. At present, carbonated drinks attract 28% GST plus 12% compensation cess, equating them with tobacco and pan masala. The industry body argued that such classification is unfair as aerated beverages do not carry comparable public health concerns. Inste
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FAQ :
The IBA is urging the GST Council to reclassify aerated beverages from the 'sin/demerit' category to the 'food/merit' category.
Currently, aerated drinks attract 28% GST plus a 12% compensation cess, totalling 40%.
The IBA proposes placing aerated drinks under the 18% GST slab.
The IBA suggests adopting a sugar-based taxation approach, similar to global models, to differentiate between high-sugar and healthier drink options.
Lowering GST could improve affordability, spur demand, unlock economic growth for distributors and retailers, encourage investment, and support job creation.
The IBA has reiterated its demand to rationalise GST on fruit juices from 12% to 5% to boost affordability and demand.
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