GST on Water and Water Based Products

What is the GST Rate for Water and Water Based Products in India

Water and water-based products attract a GST of 5%. This includes distilled water, mineral water, spring water and groundwater. Please note that these GST rates also apply to any water-based products and beverages that are at least 50% water based on volume. This can include lemonade, soda, etc. 

Why is the GST Rate for Water and Water Based Products in India Important

Water is one of the most important things needed for human survival and is hence, a crucial part of our day-to-day lives. The taxes, particularly GST levied on water affects the price and availability of water. The GST rate on water is a nominal 5%, which ensures that potable water is readily available at affordable prices. 

What are the Different Types of Water and Water Based Products in India

Water and water-based products are broadly classified into two categories - potable and non-potable water. Potable water is safe for immediate consumption whereas non-potable water is not fit for immediate consumption. The rate of GST on potable water is 18% whereas the rate of GST on non-potable water is 5%. 

1. Water and Water-based Products @ 0%

The following products will not attract any GST: 

 

• Water that is not distilled,  mineral, aerated, purified, demineralized, ionic, medicinal, battery 

• Water sold in sealed container

• Non-alcoholic Toddy 

• Neera (date and palm neera)

• Non-branded tender coconut water (which is not packaged)

2. Water and Water-based products with 5% GST 

The following products will attract 5% GST: 

 

• Ice and snow meant for consumption

3. GST on Water and related products @ 12% GST

The following products will attract 12% GST:

 

• Drinking water, packaged in 20 litre cans

• Branded and bottled tender coconut water

• Aerated water

• Lime juice/lemonade

4. Water and Related Products @ 18% GST

The following products will attract 18% GST:

 

• Natural and artificial mineral water

• Aerated water without any sugar, sweeteners or flavourings

• Non-alcoholic beverages (excluding tender coconut water) 

5. GST Rate on Water and Related Products @28%

The following products will attract 28% GST:

 

• All other products, that contain sugar, sweeteners or flavouring agents

How to Calculate the GST Rate for Water and Water Based Products in India

As per existing GST guidelines, the rate of GST on water and water-based products is 5%. There are, however, a few exceptions to this rule - for example, the rate of GST on packaged water is 18% and the rate of GST on aerated and flavoured water-based drinks is 28%. 

 

A framework that will help you understand the GST rates better is understanding that the GST hovers around 12% for goods and services that are considered essential or necessary for survival. On the flip side of this, all goods and services that are considered to be luxury goods will typically attract a GST of 28%. 

HSN Code and GST Rate on Water as Well as Related Products