PepsiCo and Coca-Cola now falls under the luxury drink category as per GST rate slabs

The Indian Beverage Association, which represents PepsiCo and Coca-Cola, is disappointed for the re-categorization of aerated drinks in the luxury category under the GST rate slabs announced by the GST Council, as per the reports published by the GST Council.

The statement says, "The viability of the industry could be in grave danger because of such an adversarial tax approach."

As the report says, a cola industry official, said, "If there is an additional cess on the category over and above the 28% GST rate, it’s going to have a severe impact, as that will lead to consumer price hikes of as much as 20% and kill the industry."

Statement issued by IBA reads, "At Rs 10 for 200 ml, aerated drinks are neither luxury goods nor do they carry the kind of health hazards attributed to them. Aerated drinks are not ‘sin’ goods as the Union Government itself had accepted earlier and there are observations by the court on the basis of the report of an expert panel that the ingredients present in aerated drinks do not pose any health hazard."