CHENNAI: The recent decision to cut GST rates on a range of dairy products to 5% is expected to bring widespread benefits for consumers and farmers, according to K. Rathnam, CEO of Milky Mist Dairy Food Ltd.
The move will make nutritious, value-added dairy items such as cheese, butter, ghee, and paneer more “affordable” and “accessible,” Rathnam said.
“For the dairy sector, this comes as a timely boost that will drive demand, encourage innovation, and strengthen the organised dairy ecosystem. At Milky Mist, we see it not just as a tax reform but as a catalyst for inclusive growth,” he added.
In a statement issued on Friday, Rathnam highlighted that the lower GST is likely to expand the market for high-quality, packaged dairy products, enabling consumers to move away from unregulated supply chains toward safe, standardised options.
“This shift benefits public health while also creating stable, stronger demand for millions of dairy farmers, who are the backbone of our industry,” he noted.
The GST reduction also aligns with India’s nutritional goals of making protein- and calcium-rich foods more affordable, particularly in rural and semi-urban regions.
“As an industry, we now have the opportunity—and responsibility—to reinvest these gains in farmer training, sustainable sourcing, cold chain infrastructure, and product innovation to meet evolving consumer needs,” Rathnam said.
Under the revised GST structure announced on September 3, ultra-high temperature (UHT) milk will attract a 0% GST, down from 5%, while pre-packaged paneer and chhena will also see GST reduced to nil. Butter, ghee, dairy spreads, cheese, condensed milk, and milk-based beverages will attract 5% GST from September 22, 2025, compared to the current 12%.
