On 17th July, the CBIC issued FAQs clarifying the GST applicability on pre-packaged and labelled goods. The said changes were introduced following the recommendations of the GST Council in its 47th meeting. The recommendations have come into effect from 18th July 2022.
The FAQs clarified that all pre-packaged items containing a quantity up to 25 Kg (or 25 litre), will attract 5 per cent GST. However, items, which are pre-packaged above 25 Kg, in a single packet will be exempt from GST.
The FAQs also addressed if GST would be applicable to a package containing multiple retail packages. The clarification stated that if several packages intended for retail sale to the ultimate consumer are sold in a larger pack, then GST would apply to such supply. Such a package may be sold by a manufacturer through a distributor.