The bakery outlets usually supply bakery products such as cakes, pastries, biscuits, cookies, bread, buns, cupcakes, muffins, rusks, rusks, etc. which are taxable under Goods and Service Tax (GST). In addition to the above products nowadays, bakery shops also sell food products such as sandwiches, samosas, rolls, pizzas, and cold drinks.
Applicability of GST on cakes and pastries
Businesses exceeding a certain turnover must have a GST registration. This limit is Rs. 40 lakhs for goods and Rs. 20 lakhs for services. Thus, if a bakery selling cakes and pastries surpasses this limit, GST is applicable. It’s imperative for such businesses to track their turnover to identify GST registration needs.
Applicable GST Rates for Various Bakery Products
| Item Name | HSN Code | GST Rate |
|---|---|---|
| Bread | 19051000 | 0% |
| Buns | 5% | |
| Pizza Base | 5% | |
| Cakes | 19059010 | 18% |
| Pastries | ||
| Cupcakes | ||
| Brownie | ||
| Muffins | ||
| Biscuits | 19053100 | 18% |
| Cookies | ||
| Rusks | 19054000 | 5% |
FAQs
Q1. What is the HSN code for cakes and pastries?
Cakes and pastries are covered under Chapter Head 19. The supply of such items will be covered under HSN Code 19059010.
Q2. Is bakery exempted from GST?
No, bakeries are not fully exempt from GST. Basic bakery items fall under 5% GST, while fancier pastries and cakes have 18% GST
Q3. Is there GST on restaurants and bakeries?
Yes, both restaurants and bakeries provide taxable supply as per GST law. The restaurants can either pay GST at 5% without availing of ITC (i.e., the Composition scheme) or 18% after availing of ITC. Whereas bakery products usually attract a GST rate of 5% or 18%. Also, there exists no availability of the Composition Scheme for bakeries under GST.
Q4. What is the GST rate for brownie cake?
As brownie cake essentially falls under the category of cakes, it generally inherits the same GST rate as regular cakes, i.e., 18%.
Q5. What is the GST rate for bakery items?
Bakery items subject to a 5% GST rate are – buns, rusks, pizza bread, and toasts
Whereas cakes, pastries, brownies, muffins, cupcakes, cookies, biscuits, etc. are subject to 18% GST.
