GST 2.0 Impact: Milky Mist Ups Milk Procurement Prices; Cheese, Butter, Ghee To Get Cheaper

IPO-bound dairy major Milky Mist on Monday has announced a fresh set of revisions in its pricing structure, to pass on benefits from the recent Goods and Services Tax rate revisions to consumers.

Milk procurement prices are now up 3.5%, in a bid to ensure direct support for farmers, reported news organisation businessline. The company had earlier increased procurement prices by up to 3.5% as of Sept. 1.

Paneer prices also see a dip with the new GST structure in place ensuring levies get slashed on the household essential. To this end, other dairy products including cheese, butter, ghee, and condensed milk see GST fall from 12% to 5%. Ice cream and chocolate are also cheaper, with their GST rate down from 18% to 5%.

While the GST benefit are passed down to the consumers in most dairy categories offered by the company, certain products like paneer will see a portion of the benefit absorbed by the company in order to maintain availability and quality, reported businessline citing a Milky Mist statement.

"At Milky Mist, we are focused on our farmers and consumers. By passing on the GST benefits and increasing procurement prices, we are ensuring equilibrium in the dairy ecosystem. This initiative is a step forward in creating trust, and long-term partnerships" said K Rathnam, whole-time director and chief executive officer at Milky Mist. 

The GST reduction aligned with the country's nutritional vision of making protein and calcium-rich foods more affordable, especially in rural and semi-urban areas, Rathnam had stated earlier.

"As an industry, we now have an opportunity and a responsibility to reinvest these gains into farmer training, sustainable sourcing, cold chain infrastructure and product innovation that meets evolving consumer needs," he said.