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Grocery Items HSN Code and GST Rate in India

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Walk into any neighbourhood kirana store in India and you’ll see the same familiar shelves. Rice sacks stacked in the corner. Pulses in containers. Cooking oil, tea, biscuits, spices. Nothing fancy. Just everyday food items that people pick up almost daily.

All of these fall under what we casually call grocery items.

Now here’s the interesting part. From a taxation and trade point of view, these products are not treated casually at all. Every single item — whether it is rice, sugar, tea, or biscuits — is placed under a specific HSN code. And that code decides how much GST applies.

For shopkeepers, wholesalers, and even supermarket chains as well as traders, understanding the grocery items HSN code system is not optional. It directly affects billing, GST filings, and tax credits.

Let’s break it down in a simple way.

What Are Groceries?

In everyday language, groceries simply mean food and household consumption items that people buy regularly. Items that keep the kitchen running.

Think about the basics.

Rice. Wheat flour. Pulses. Sugar. Cooking oil. Tea. Coffee. Spices. Biscuits. Breakfast cereals.

These products are sold through kirana stores, supermarkets, wholesale markets, and online grocery platforms. Some are sold loose. Others come neatly packaged.

From a GST perspective though, each of these items has its own HSN classification. That’s why there is no single Kirana HSN code for all grocery products. Instead, every category sits under its own code.

And once the grocery HSN code is identified, the applicable GST rate becomes clear.

Grocery Items HSN Code and GST Rate

The GST system treats grocery items slightly differently from many other goods.

Basic food essentials are usually taxed lightly. In many cases, not taxed at all.

Processed foods? That’s a different story.

Below is a simple grocery item HSN code list for some common items.

Grocery Item HSN Code GST Rate
Rice (other than pre-packaged and labelled) 1006 0%
Rice (pre-packaged and labelled) 1006 5%
Wheat flour (other than pre-packaged and labelled) 1001 0%
Wheat flour (pre-packaged and labelled) 1001 5%
Bread (branded or otherwise) 1905 0%
Sugar 1701 5%
Salt 2501 0%
Pepper 0904 5%
Edible oils (olive oil, sunflower oil, groundnut oil, coconut oil etc.) 1508, 1509, 1512, 1513 5%
Fresh and pasteurised milk 0401 0%
Ultra High Temperature (UHT) milk 0401 5%
Butter 0405 12%
Ghee 0405 12%
Tea 0902 5%
Coffee 0901 5%
Spices (various) 0910 5%
Pasta 1902 12%
Muri or puffed rice 19041020 0%
Corn flakes and prepared goods from cereal flakes (other than puffed rice) 1904 (other than 19041020) 18%
Biscuits (non-branded) 1905 18%
Soft drinks (aerated beverages with sugar or flavour) 2202 28% + 12% Compensation Cess

Applicability of GST on Grocery Items

The GST framework for groceries works on a basic idea.

Essential foods should remain affordable.

That’s why many daily consumption items fall into the 0% or 5% GST slab. Grains, pulses, fresh dairy, and some basic staples are either exempt or taxed lightly.

But once the food becomes processed or packaged, the tax rate can increase.

For example:

  • Raw grains – usually 0%
  • Packaged staples – often 5%
  • Processed foods like cereals, chocolates, and snacks – sometimes 18%

So the GST system is not just taxing the product. It’s also taxing the value addition.

The more processed the food becomes, the higher the tax slab tends to be.

Is ITC Available on Grocery Items?

Now we come to something that confuses many small traders.

Input Tax Credit, or ITC.

The idea behind ITC is straightforward. If a business pays GST while purchasing goods, it may claim that tax credit when selling the goods further.

But groceries complicate things slightly.

If a trader buys taxable grocery items, then ITC can generally be claimed.

If the product itself is GST-exempt, then there is no tax credit to claim.

For example:

  • A retailer selling packaged tea can usually claim ITC.
  • A trader dealing only in exempt food grains cannot claim ITC.

So the ITC chain flows only through taxable supplies.

Once a product falls under the 0% GST category, the credit chain usually stops there.

Advance Rulings Related to Grocery HSN and GST

Sometimes classification is not as obvious as it looks.

Is a product a basic grocery item? Or a processed food product?

That’s where Advance Rulings come in.

Businesses can approach GST authorities and ask for clarity on:

  • the correct grocery HSN code
  • the applicable GST rate
  • eligibility of input tax credit

This becomes important when a product sits somewhere in the middle.

For instance:

Is a flavored cereal a basic grain product or a processed food?

Is a health mix a grocery item or a nutritional supplement?

In such cases, advance rulings help businesses avoid tax disputes later.

Final Thoughts

At first glance, groceries look like the simplest category in retail. Everyday products. Nothing complicated.

But the tax system behind them is actually quite structured.

Each item has a grocery HSN code, a specific GST rate, and sometimes even classification debates.

For retailers, wholesalers, and kirana stores, understanding this structure helps avoid billing errors and compliance problems.

And once the grocery item HSN code list becomes familiar, GST filing also becomes a lot easier.

Because in the end, groceries may be simple products — but the tax rules behind them certainly are not.