GST on Cold Drink 2026 — Aerated Beverages, Juices & Packaged Water Rates
Updated: 3 June 2026 | CGST Act | GST Council Decisions | HSN 2201 / 2202 / 2009
Highest beverage tax slab in India — applies to all carbonated soft drinks and energy drinks.
GST Rates on Cold Drinks & Beverages — Complete Table
| Beverage / Category | Examples | HSN Code | GST Rate | Cess |
|---|---|---|---|---|
| Plain fresh milk | Amul full cream milk, Mother Dairy (unflavoured) | 0401 | 0% (Exempt) | None |
| Tender coconut water (fresh) | Fresh green coconut water (unpackaged or simple pack) | 0801 | 5% | None |
| Packaged drinking water >20 litres | 20L water jar/can (bulk water) | 2201 | 5% | None |
| Fruit juices (100%) | Tropicana, Real, Dabur juice | 2009 | 12% | None |
| Coconut water (sealed pack) | Tender coconut water in carton/bottle | 2009 | 12% | None |
| Vegetable juice | Tomato juice, carrot juice (packaged) | 2009 | 12% | None |
| Fruit-based drinks / nectars | Maaza, Frooti, Slice, Appy Fizz (non-aerated) | 2202 | 12% | None |
| Flavoured milk | Amul Kool, Nandini flavoured milk | 2202 | 12% | None |
| Packaged drinking water ≤20 litres | 1L / 500ml / 250ml bottles | 2201 | 18% | None |
| Plain carbonated / mineral water | Perrier, Himalayan sparkling water | 2201 | 18% | None |
| Aerated cold drinks (non-fruit) | Coca-Cola, Pepsi, Sprite, Thums Up, Limca, 7Up | 2202 | 28% | 12% Cess |
| Aerated fruit drinks (carbonated) | Appy Fizz, Mirinda Orange (carbonated) | 2202 | 28% | 12% Cess |
| Energy drinks (carbonated) | Red Bull, Monster, Sting, Rockstar | 2202 | 28% | 12% Cess |
| Alcoholic beverages | Beer, whisky, wine, rum | — | Outside GST | State VAT + Excise |
Why Aerated Drinks Face 40% Effective Tax
India has maintained high taxation on aerated beverages since before GST was introduced. When the GST regime replaced the pre-GST system of excise duty + VAT + cess in July 2017, aerated drinks were placed in the highest slab (28%) and also subjected to a 12% Compensation Cess to compensate states for revenue loss. This makes aerated cold drinks one of the most heavily taxed FMCG categories in India, alongside tobacco and luxury goods.
The 12% Compensation Cess is levied under the GST (Compensation to States) Act, 2017 and applies over and above the 28% GST. For a cold drink with a base price of ₹100, the total tax payable by the manufacturer/distributor is ₹40 — ₹28 as GST and ₹12 as cess. The MRP you see on the bottle is the price inclusive of this tax burden.
GST on Carbonated vs. Non-Carbonated Drinks
The key distinction for GST on beverages is whether the drink is aerated (carbonated). Any drink containing dissolved CO2 — regardless of whether it is a cola, energy drink, sparkling water, or fruit-flavoured soda — attracts 28% + 12% cess if it also contains added sugar, sweeteners, or flavour. Plain carbonated (sparkling) water with no added flavour or sugar attracts 18% GST instead. Non-carbonated fruit juices, coconut water, and nectars attract 12% GST. Understanding this distinction is important for businesses importing, manufacturing, or distributing beverages.
ITC Rules for Cold Drink Manufacturers & Distributors
Businesses registered under GST in the beverage supply chain can claim Input Tax Credit (ITC) on their purchases (raw materials, packaging, capital goods, services). Manufacturers of aerated drinks can set off the 28%+cess paid on outward supply against the GST paid on inputs — such as sugar, flavouring agents, CO2, bottles, and machinery. However, ITC on Compensation Cess paid cannot be used to offset regular GST output liability; cess ITC can only be used to offset cess liability. For cold drink retailers and distributors, normal ITC rules under the CGST Act apply.
Frequently Asked Questions
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