HomeWhat's TrendingAAR Rules That Infant Milk Formula is Subject to 18% GST

AAR Rules That Infant Milk Formula is Subject to 18% GST

 The GST-Authority for Advance Rulings (AAR) in Rajasthan has ruled that Bebymil correctly applies an 18% GST to its infant milk formula products. These products, marketed under the brand name Momylac, are tailored for different age groups. Bebymil sought clarification from the AAR as some competitors were charging only 5% GST on similar products.

The AAR clarified that Chapter 4 of the GST classification pertains solely to milk products. In Momylac’s case, milk is just one component among cereals, protein supplements, and other ingredients that vary with the infant’s age. This composition justified the higher GST rate.

Tax experts highlight the need for simpler classification norms. They point to inconsistencies, like the Gujarat AAR’s ruling that exempts lassi from GST, while flavoured milk is taxed at 12%.

India’s GST categorisation follows the Harmonised System of Nomenclature (HSN), an international framework by the World Customs Organization. This system includes 21 sections, 99 chapters, 1,244 headings, and 5,224 sub-headings, ensuring detailed and specific classification of goods.

 The recent ruling by the GST-Authority for Advance Rulings (AAR) in Rajasthan, which mandates an 18% GST on infant milk formula products like Bebymil’s Momylac, highlights ongoing complexities in GST classification. The decision underscores the need for clearer, more consistent guidelines, as discrepancies persist in similar product categories. For instance, while the Gujarat AAR exempts lassi from GST, flavoured milk faces a 12% tax. Such inconsistencies point to the necessity for streamlined classification norms within India’s GST framework, which adheres to the Harmonised System of Nomenclature (HSN) for detailed product categorisation.

 Navigating GST complexities can be challenging, especially with evolving rulings and classifications. Vakilsearch offers expert legal and tax services to help businesses stay compliant and optimise their tax strategies. Our team of professionals ensures accurate GST filings, helps resolve classification disputes, and provides strategic tax planning to minimise liabilities. Trust Vakilsearch to handle your tax and legal needs, so you can focus on growing your business with peace of mind. Contact us today to simplify your GST compliance and stay ahead in the regulatory landscape.


Akash G Varadaraj