GST on Aerated Water

gst on aerated water
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GST on Aerated Water

GST Rate on Aerated Water under GST

A regular/normal registered taxpayer whether a manufacturer or supplier of aerated water will be taxed at the rate of 28% but will be eligible for the input tax credit.

HSN Code Description of Goods GST Rate

2202 10

All goods (including aerated waters), containing added sugar or other sweetening matter or flavoured

28%

Who can avail the benefit of  Composition Scheme u/s 10(1)?

  • Manufacturers except the below mentioned.
  • Persons engaged in making supplies referred to in clause (b) of paragraph 6 of Schedule II of the said Act.
    • As per clause (b) of paragraph 6 of Schedule II :- The following composite supplies shall be treated as a supply of services, namely:— (b) supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink (other than alcoholic liquor for human consumption), where such supply or service is for cash, deferred payment or other valuable consideration.
  • Other suppliers.

List of manufacturers who are excluded from the purview of the composition scheme u/s 10

Before the CGST notification no. 43/2019 dated 30th September’19 was issued there were only manufacturers of 3 types of described goods who were excluded from the levy of composition scheme. Manufacturers of one more good are added to the list who cannot avail the composition scheme.

Sr. No.

Tariff item, subheading, heading or Chapter

Description

1

2105 00 00

Ice cream and other edible ice, whether or not containing cocoa

2

2106 90 20

Pan masala

2A

2202 10 10

Aerated Water

(Inserted vide CGST Notification no. 43 dated 30.09.19)

3

24

All goods, i.e. Tobacco and manufactured tobacco substitutes.

Note: There is no restriction on trading/supplying the above-described goods and availing the benefit of composition scheme u/s 10(1) of the CGST Act 2017.

Note: This notification shall come into force on the 1st day of October 2019.

Composition Scheme as per CGST(R) Notification no. 2/2019 dated 7th March 2019

As per sub-point (viii) of point 1 in conditions column: – Persons who are engaged in making supplies of the specific goods listed below are disallowed from taking registration as a service provider under the composition scheme notified.

Following are the listed goods

Before the CGST(Rate) Notification no. 18/2019 dated 30th September’19 was issued service providers who intended to take registration in the above composition scheme were denied registration if they were/wanted to supply the specific 3 types of goods listed below. With the latest notification, one more good is added to the list which cannot be supplied.

Note: There is a restriction on trading/supplying the above-described goods as a composite supplier(service provider who also supplies goods) who takes/has taken registration under composition scheme as per CGST(Rate) Notification No. 2/2019 dated 7th March’19 where tax @6% on goods and service provider or both are charged. 

Note: This notification shall come into force on the 1st day of October 2019.

 

Conclusion

  • Any person engaged in the manufacturing of aerated water shall not be eligible to take the benefit of the composition scheme.
  • Any person who is a supplier of aerated water will be eligible to take the benefit of the composition scheme.
  • Any person who supplies aerated water in the restaurant will be eligible to take the benefit of the composition scheme u/s 10(1).
  • Any person who is registered as a service provider as per CGST(Rate) Notification No. 2/2019 dated 7th March’19 also supplies aerated water will not be eligible to take the benefit of the composition scheme.
Particulars Applicable rate
Regular Taxpayer
Manufactures or supplies aerated water 28%
Composition levy u/s 10
Manufacturer of aerated water Not allowed as per notification 43 dated 30.09.19
Restaurant providing aerated water 5%
Other Suppliers of aerated water 1%
Service provider registered as per CGST Rate notification no. 2/2019 dated 7th March 2019
Supplies aerated water Not allowed as per notification 18 dated 30.09.19

 

 

Following notifications and parts from the CGST Act are used to compile the above post


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About CA Ankita Khetan 163 Articles
Ankita is a Chartered Accountant in practice and holds a Diploma in IFRS (from ACCA, UK). She is also a Commerce PG and Certified Independent Director (from IICA). She holds a certification in Forex and Treasury Management. Her area of expertise is GST and Income tax. She is passionate about reading, writing, and sharing knowledge on areas related to finance and taxation.

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