GST Cut Makes Instant Coffee More Affordable

Fast Summary

• GST Reduction: The Union Government has reduced the GST on coffee from 18% to 5%, effective september 22.
• Industry Reaction:

– Rajat Agarwal (CEO, Barista Coffee): Positive impact on sourcing costs adn consumer spending.
– Rana George (MD, Kelachandra Coffee): Uplifts the coffee industry by boosting domestic consumption and creating a fair value chain.- Harpreet Singh (Partner, Deloitte India): Benefits consumers but presents inventory challenges for retailers.
– Praveen jaipuriar (CEO, Continental Coffee): Fuels demand during festive season and aligns with inclusive growth principles.
– srikanth Rao (Director, Bayars Coffee): Reduces prices for filter coffee products in retail markets.
– Vikram Khurana (CEO, Kaapi Solutions): Encourages affordability and drives innovation within India’s growing coffee culture.

Indian Opinion Analysis

the GST reduction on coffee is a progressive financial reform aimed at making this popular beverage more affordable. By lowering tax burdens across the supply chain-from growers to retailers-the move is expected to strengthen domestic consumption and India’s position in global specialty markets. Industry voices suggest wider implications including boosted economic activity during festive seasons and potential innovation investments due to reduced financial pressures. while retail price adjustments could benefit consumers considerably, short-term inventory losses may pose challenges for businesses transitioning under the new rates. this decision reflects an opportunity for inclusive growth aligned with increasing consumer demand in urban areas.

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