Government receives plea to cut 28% GST on aerated drinks
The meeting is already set to review a broader rate rationalisation framework, with officials indicating that certain slabs and cesses may be simplified or merged.Carbonated drinks fall under the so-called 'sin goods' category—alongside tobacco and pan masala—which invites the highest GST rate and a cess. Industry players have long argued that such classification is outdated, especially for low-sugar and fruit-based carbonated products.Recent court rulings have also put pressure on the current tax structure. The Gauhati High Court had ruled that certain fizzy fruit drinks, if primarily juice-based, should be taxed at 12% instead of 28%. However, this has not led to a broader reclassification.While some states may resist the change due to the revenue implications of scrapping the cess, the Centre is reportedly open to exploring alternatives as part of a wider reform to make the GST system more predictable and investment-friendly.Any revision in GST rates or cess removal would likely translate into lower prices for consumers and improved margins for beverage makers.- Ends
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