There’s a great news for all those who were wondering whether their grocery bills will go up or cut short after the GST rollout post midnight today. With the strike of midnight hour on Friday, a new regime of tax will be levied in India and it is known as Goods and Service Tax or GST. Ever since India gained freedom 70 years ago, it is the first ever tax reform of such a great magnitude. There will be a special ‘tryst with destiny’ session of Parliament at midnight on Friday. The new tax will lead to surge in prices of many items in the country, the biggest slab of 28% is slapped at the luxury products.
With the roll out of GST just a couple of hours away, people are wondering with baited breath, what will the new GST rates of the products of daily need. We’re going to discuss each and every aspect of our life that will come under the direct impact of GST. Let’s discuss how GST is going to affect your food and grocery bills.
Most of the groceries, household and personal care products will remain at the same price for at least 6-8 weeks post rollout. The companies aren’t sure how the new taxation scheme will impact their cost of operations. Here’s brief information on what will get cheaper and what will get costlier after GST rollout. Have a look.
Most of the food items have been exempted from tax under GST, which is a respite for a common man. Remaining fall under a lower tax category of 5 per cent or 12 per cent. Unpacked foodgrains, unbranded atta, maida, besan, fresh vegetables and fruits, salt will get cheaper as these items have been exempted from tax under the GST. Many of the processed food items which will fall under 5 per cent tax will also get cheaper.
Personal care products like soaps, hair oil and toothpaste might get cheaper at 18 per cent tax. Let us remind you, all these products are taxed at 24-28 per cent under current regime.
Tea, coffee and spices are taxed under lower tax category of 5 per cent. Currently they are taxed at 3-4 per cent.
Personal care products like shampoos and deodorant will be expensive post GST.
There will be no change in the milk price. Milk and curd is the largest consumer segment in our country. It is exempted from the new tax, thankfully. Market Leader Amul said, “We will drop prices of milk powder and baby food by close to 5%”. But the new prices will be applied after a week or 10 days once the existing stock gets consumed.
The prices of aerated drinks will be increasing post midnight. The packaged water Kinley, however, will be prices under a lower bracket. The company is still evaluating the hike and the date when the hike will be implemented. The aerated drink industry is the worst hit as it will be taxed at 40 per cent under GST regime.
"The company has no choice but to minimally increase the prices even after absorbing the significant portion of the tax increase," Coca-Cola India said in a release. "We will pass on the taxation benefits to the consumers and make all attempts to absorb the maximum impact of the escalation of tax in some categories of our beverage portfolio," Coca-Cola India and southwest Asia business unit president T Krishnakumar said.
Apart from this, for the common man, there’s no need to fret as the prices of our daily needs aren’t affected under the new GST scheme.