Cola to lose fizz: GST hike to 40% makes soft drinks, energy drinks costlier

New Delhi: Popular soft drinks, such as Coca-Cola and Pepsi, along with other non-alcoholic beverages, will become costlier, with the GST Council on Wednesday approving a hike in tax rate on carbonated beverages to 40 per cent from 28 per cent at present.

As part of the reforms of the Goods and Services Tax (GST), the council increased the rate on carbonated beverages of fruit drink or carbonated beverages with fruit juice to 40 per cent from 28 per cent.

The council also hiked the GST rate on caffeinated beverages to 40 per cent from 28 per cent.

Other non-alcoholic beverages will also become costlier, as the GST rate on these items has been increased to 40 per cent from 18 per cent.

The GST council has also raised the rate on all goods (including aerated waters), containing added sugar or other sweetening matter or flavoured to 40 per cent from 28 per cent.

On the other hand, the rate on fruit pulp or fruit juice-based drinks (other than carbonated beverages of fruit drink or carbonated beverages with fruit juice) has been cut to 5 per cent from 12 per cent.

Similarly, plant-based milk drinks, ready for direct consumption as beverages, will become cheaper with the GST rate being reduced to 5 per cent from 18 per cent earlier, while that of soya milk drinks has also been cut to 5 per cent from 12 per cent.