The government has reduced GST on many dairy products. Due to this, products like paneer, ghee, butter, cheese and condensed milk will become cheaper. Customers will directly benefit from this.
Many dairy and milk products will become cheaper after the changes in GST. Ice cream and other milk products such as paneer, ghee, butter, cheese and condensed milk may become cheaper by 5 to 10 percent, as the dairy industry is preparing to pass on the benefits of the reduction in GST (Goods and Services Tax) to the customers before the festive season. Some changes have been made in the GST Council meeting, which will come into effect from 22 September 2025.
The dairy industry believes that the reduction of GST on UHT milk and cheese to zero will increase the consumption of dairy products in India and will also curb adulteration and tax evasion. The government reduced GST from 12% to 5% on condensed milk, butter, cheese, ghee, dairy spread, butter oil and milk beverages. At the same time, GST on UHT milk and packaged and labeled cheese or chenna was reduced from 5% to zero. GST on cocoa powder, chocolate and other food products made from cocoa was also reduced from 18% to 5%.
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| Product | current rate | update rate |
| UHT Milk | 5% | Zero |
| condensed milk | 12% | 5% |
| Soy milk drinks | 12% | 5% |
| Milk-based beverages | 12% | 5% |
| Plant-based milk drinks | 18% | 5% |
| Iron, steel or aluminium milk cans | 12% | 5% |
| Chhena or Paneer (packaged and labelled) | 5% | Zero |
| Pizza Bread | 5% | Zero |
| Butter and other fats (such as ghee, butter oil, etc.) and dairy spreads | 12% | 5% |
| Thing | 12% | 5% |
Dairy related stocks rise
After the announcement of reduction in GST, agriculture and dairy related stocks saw a tremendous rise. Shares of Parag Milk Foods rose 7.4% to ₹ 263.50, while Dodla Dairy shares rose 4.5% to ₹ 1,498.85. The recent GST reduction on dairy products has reduced the tax on UHT milk, cheese, butter and ghee, which will directly benefit consumers.
Mother Dairy has ensured that these savings are passed on to the customers, making dairy products more affordable. Apart from this, Amul has also welcomed the government’s move and said that this will benefit the dairy sector.
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