Indian Ice Cream Industry Receives Boost with 5% GST Reduction

The Indian Ice Cream Manufacturers' Association (IICMA) welcomes the government's decision to reduce the Goods and Services Tax (GST) on ice cream to 5%. This move aims to ease the burden on businesses, boost industry growth, create new jobs, and strengthen the dairy sector. The IICMA president, Sudhir Shah, expressed gratitude and believes the reform will encourage innovation, investment, and exports, making Indian ice cream products more competitive globally.

The Indian Ice Cream Manufacturers' Association (IICMA) has welcomed the government's recent decision to reduce the Goods and Services Tax (GST) on ice cream to 5%. This move, effective from September 22, 2025, is part of a broader GST reform aimed at boosting the dairy sector and benefiting both farmers and consumers.

The Ministry of Fisheries, Animal Husbandry & Dairying announced that the 56th GST Council meeting approved sweeping tax rationalizations on milk and milk products. Under the new structure, ultra-high temperature (UHT) milk and paneer will be tax-exempt, while other dairy products like butter, ghee, cheese, and ice cream will be taxed at 5% [1].

The reduction in GST on ice cream from 18% to 5% is expected to ease the financial burden on businesses, encouraging innovation and investment. Sudhir Shah, the president of IICMA, expressed gratitude for the reform, stating that it would create new jobs, strengthen the dairy sector, and make Indian ice cream products more competitive globally [1].

The overall market size of the Indian dairy sector is estimated at Rs 18.98 lakh crore in 2024, with India being the world's largest milk producer, accounting for about 24% of global milk production. The GST reforms are expected to enhance productivity and competitiveness while ensuring sustainable livelihoods for over 8 crore rural farmer families [1].

The reduction in operational costs due to lower taxation is also anticipated to help curb adulteration, further benefiting consumers. These reforms are part of a broader strategy to promote economic growth and socio-economic development in the country.

References:
[1] https://economictimes.indiatimes.com/industry/cons-products/food/gst-rate-cut-to-spur-demand-in-rs-19-lakh-cr-dairy-industry-government/articleshow/123700318.cms