GST Council slashes Millet flour tax to 5% from 18%: Boosting 'Year of Millets'

In a move aimed at boosting the consumption of millet-based products, the Goods and Services Tax Council has announced a reduction in tax rates. Millet flour food preparations, previously taxed at 18%, will now attract a 5% GST on packaged flour and none on loose Millet flour.

This decision aligns with India's current focus on promoting millets, marking 2023 as the 'Year of Millets'. The move is anticipated to make millet-based products more accessible and affordable for consumers across the country.

The GST Council's decision comes after the fitment committee's recommendation to grant an exemption on powdered millet. While incentives for prepared produce made from millet were not initially considered, this revised taxation policy is expected to encourage the production and consumption of millet-based food items.

Additionally, the Council is believed to have reached a consensus on imposing an 18% GST on corporate guarantees extended by holding companies and subsidiaries. This measure aims to streamline financial regulations in the corporate sector.

Furthermore, the Council deliberated on a proposal to reduce the GST on molasses from the existing 28% to 5%. This adjustment is anticipated to provide clarity to the liquor industry and facilitate smoother operations within the sector.

The decisions made during the 52nd GST Council meeting reflect the government's ongoing efforts to support sustainable agriculture practices, promote healthier dietary choices, and create a more business-friendly environment for various industries in the country.

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