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How The GST Will Affect Your Wallet & Your Waistline

Goes without saying that as of 1st July, G.S.T. will have an impact on everything in your life. The most obvious difference you’ll see pre and post-GST is on the food you eat. A pretty straightforward way to round-up how it’s going to affect your diet is this: being healthy will become cheaper, and all things calorific will become more expensive. So good news for our wallets AND our waistlines!

Here’s how the G.S.T. will affect your food bills:

If you’re eating in:

Your bare necessities – eggs, salt, milk, fresh fruits and vegetables, fresh meat, food grains, and flour – will be much cheaper under G.S.T. because they will be either taxed at 0% (few at 5%), down from the 5-7% VAT applied on these items initially. That’s not all, these tax slabs won’t only affect fresh foods. Even processed and packaged foods – from cornflakes to coffee – will be taxed at 12%, down from 15-18%. FMCG giants like Nestle, Amul and Hindustan Lever have even promised to pass on the benefits of reduced taxes to the consumers by reducing their prices. So your daily bread and butter is now cheaper, quite literally!Indirect tax-Tax paid to government on gross money flow i.e purchase of goods and services E.g. Sales Tax, Vat, Service TaxDirect Tax- Tax paid to government on net money flow i.e income

For you lazy lot, don’t for one second think that ordering take-out still qualifies as “eating in”! It comes from a restaurant after all, so read on…

If you’re eating out:

Whether you’re ordering a pizza on Swiggy or grabbing a slice at your favourite pizzeria, if the kitchen its made in belongs to an AC restaurant, you’re paying 18% G.S.T.

Since the idea behind G.S.T. is to tax everyday essential items lower (0%, 5%, 12%), and luxury items higher (18%, 28%), dining in 5-star restaurants is obviously taxed at 28%! The main reason behind this is to make the rich pay more taxes and make things cheaper for common people.


Confused? Don’t worry, you aren’t alone. Restaurants themselves are confused about this.  A lot of restaurants have an A.C section and a Non-A.C. one. What does it mean for them? It will take a few months till restaurants figure these things out and come up with final price lists.

Also, in a few months, restaurants will figure out how to claim taxes paid on the raw materials purchased, and the items on the menu might get cheaper. Looks like the fine-dine plans will continue being on hold till then! And if you decide to go out keep these 7 pointers in mind while you calculate g.s.t on your bill.

DRINKSSS on the houseAlcohol isn’t under the G.S.T ambit because it would create confusion as different states have different rules when it comes to alcohol. States like Gujarat do not serve alcohol. Moreover, alcohol is a major source of revenue for states and many states would not want to give this privilege up and would debate this issue in the Parliament, postponing the already late G.S.T. That’s why alcohol (even petroleum products) are outside the G.S.T Ambit and each state will tax alcohol differently.  

Also aerated beverages will attract a 28% tax and preparations of fruits and vegetables like juices too will be taxed at 12%.

Looks like you can finally ditch the alcoholic beverages, aerated beverages, processed fruit juices and go on that organic diet from home!

Despite all this a lot of places in Mumbai are looking at G.S.T positively: 

‘We do not levy service charges. The tax on food used to be 19.5 per cent earlier. It has now gone down to 18 per cent. Likewise, alcohol taxes have reduced from 26 per cent to 20 per cent and soft beverages from 31 per cent to 18 per cent. Moreover, the wine collection, which we are famous for, would be cheaper by 6 per cent.’ -Le Cirque Signature, Leela, Mumbai.

With all the chaos and confusion, let’s take a moment to digest the fact that G.S.T. has finally been implemented and it’s here to stay. And it’s been a month now since it came into our lives. So tell us what you think about it, in the comments section below. 

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