Mother Dairy, a wholly-owned subsidiary of the National Dairy Development Board (NDDB), said on Tuesday that it is reducing the consumer prices of select dairy products and processed foods under the Safal brand, in light of the recent GST reforms announced by the government, effective September 22.

“The recent GST reduction across a wide range of dairy and processed food products represents a progressive step that will significantly boost consumption and accelerate the adoption of safe, high-quality packaged offerings,” said Manish Bandlish, managing director, Mother Dairy, in a statement.

With the change, the company’s entire portfolio now falls under either the exempted/nil or the lowest slab of 5%. “We are confident this measure will positively impact the entire value chain: farmers will benefit from increased demand for packaged food products, further supported by GST reductions on farm equipment and allied components, while consumers will gain from affordable pricing and greater access to packaged dairy and processed foods,” Bandlish added.

Under the value-added dairy products, the tetra pack of Ultra High-Temperature (UHT) milk will now attract 0% GST, down from the previously applicable 5% GST rate. Similarly, paneer will also attract a nil GST rate from the 5% GST rate. Ghee, butter, cheese, and milkshakes—which attracted a 12% GST rate—will now have 5% GST levied on them, and ice creams—which attracted 18% GST previously—will similarly have 5% GST levied on them.

The value-added horticulture products under the Safal brand—which include frozen snacks, jam, pickles, packaged coconut water, and tomato puree—previously under the 12% GST slab, will now have a 5% GST rate. It should be noted that pouch milk—the everyday poly pack milk (Full Cream Milk, Toned Milk, Cow Milk, etc.) – has always been exempted from GST and continues to be so, with no implications on its Maximum Retail Price (MRP). 

Ministers have been exhorting companies across industries to pass on the entire benefits of the sweeping GST reforms to benefit the consumer fully. The GST reforms—first announced by PM Narendra Modi from the ramparts of the Red Fort on August 15—were approved by the GST Council on September 3.