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Key Highlights
- HSN Chapter 11 covers products of the milling industry, including malt, starches, inulin, and wheat gluten.
- GST rates vary based on processing levels—basic grains often attract lower rates, while processed products may be taxed higher.
- Raw cereal grains like wheat flour attract 5% GST, while starches and malt extract may fall under 12% or 18% GST slabs.
- Businesses can claim input tax credit (ITC) on GST paid for raw materials if products are used for resale or manufacturing.
- Correct HSN classification is essential to ensure compliance, avoid penalties, and benefit from ITC claims.
Products of the milling industry, including flour, malt, starches, inulin, and wheat gluten, play a crucial role in food production, pharmaceuticals, and industrial applications. Under India's goods and services tax (GST) system, these products are classified under Chapter 11 of the harmonised system of nomenclature (HSN).The GST rates on milling industry products vary based on their level of processing and end-use. While essential food-grade products attract a lower tax rate, processed and value-added derivatives are subject to higher GST rates.This article provides a comprehensive breakdown of GST rates, HSN codes, input tax credit (ITC) eligibility, and compliance requirements for businesses dealing with milling industry products.
HSN Codes and GST Rates for Milling Industry Products
Products under Chapter 11 are classified into different HSN codes, with GST rates varying accordingly. The table below outlines the relevant classifications:
GST Rates & HSN Code for Milling Products
| HSN Code | Description | Rate (%) | CESS (%) | Effective Date | Rate Revision |
| 1101 | WHEAT OR MESLIN FLOUR | 5% | 01/07/2017 | ||
| 1101 | WHEAT OR MESLIN FLOUR | 0% | 01/07/2017 | ||
| 11010000 | WHEAT OR MESLIN FLOUR | 5% | 01/07/2017 | ||
| 1102 | CEREAL FLOURS OTHER THAN THAT OF WHEAT OR MESLIN | 5% | 01/07/2017 | ||
| 1102 | CEREAL FLOURS OTHER THAN THAT OF WHEAT OR MESLIN | 0% | 01/07/2017 | ||
| 11021000 | CEREAL FLOURS OTHER THAN THAT OF WHEAT OR MESLIN RYE FLOUR | 5% | 01/07/2017 | ||
| 11022000 | CEREAL FLOUR OTHER THAN THAT OF WHEAT OR MESLIN MAIZE (CORN) FLOUR | 5% | 01/07/2017 | ||
| 11023000 | CEREAL FLOURS OTHER THAN THAT OF WHEAT OR MESLIN RICE FLOUR | 5% | 01/07/2017 | ||
| 110290 | OTHER | 5% | 01/07/2017 | ||
| 11029000 | CEREAL FLOURS OTHER THAN THAT OF WHEAT OR MESLIN OTHER | 5% | 01/07/2017 | ||
| 11029021 | BROWN RICE FLOUR | 5% | 01/07/2017 | ||
| 11029022 | WHITE RICE FLOUR | 5% | 01/07/2017 | ||
| 11029029 | OTHER | 5% | 01/07/2017 | ||
| 11029090 | OTHER | 5% | 01/07/2017 | ||
| 1103 | CEREAL GROATS, MEAL AND PELLETS - GROATS AND MEAL : | 5% | 01/07/2017 | ||
| 1103 | CEREAL GROATS, MEAL AND PELLETS - GROATS AND MEAL : | 0% | 01/07/2017 | ||
| 110311 | OF WHEAT | 5% | 01/07/2017 | ||
| 11031110 | CEREAL GROATS, MEAL AND PELLETS GROATS AND MEAL: OF WHEAT: GROAT | 5% | 01/07/2017 | ||
| 11031120 | CEREAL GROATS, MEAL AND PELLETS GROATS AND MEAL: OF WHEAT: MEAL | 5% | 01/07/2017 | ||
| 11031300 | CEREAL GROATS, MEAL AND PELLETS GROATS AND MEAL: OF MAIZE (CORN) | 5% | 01/07/2017 | ||
| 11031900 | CEREAL GROATS, MEAL AND PELLETS GROATS AND MEAL: OF OTHER CEREALS | 5% | 01/07/2017 | ||
| 11032000 | CEREAL GROATS, MEAL AND PELLETS PELLETS | 5% | 01/07/2017 | ||
| 1104 | CEREAL GRAINS OTHERWISE WORKED (FOR EXAMPLE, HULLED, ROLLED, FLAKED, PEARLED, SLICED, OR KIBBLED), EXCEPT RICE OF HEADING 1006; GERM OF CEREALS, WHOLE, ROLLED, FLAKED OR GROUND - ROLLED OR FLAKED GRAINS : | 5% | 01/07/2017 | ||
| 1104 | CEREAL GRAINS OTHERWISE WORKED (FOR EXAMPLE, HULLED, ROLLED, FLAKED, PEARLED, SLICED, OR KIBBLED), EXCEPT RICE OF HEADING 1006; GERM OF CEREALS, WHOLE, ROLLED, FLAKED OR GROUND - ROLLED OR FLAKED GRAINS : | 0% | 01/07/2017 | ||
| 11041200 | CEREAL GRAINS OTHERWISE WORKED (FOR EXAMPLE, HULLED, ROLLED, FLAKED, PEARLED, SLICED, OR KIBBLED), EXCEPT RICE OF HEADING 1006; GERM OF CEREALS, WHOLE, ROLLED, FLAKED OR GROUND ROLLED OR FLAKED GRAINS: OF OATS | 5% | 01/07/2017 | ||
| 11041900 | CEREAL GRAINS OTHERWISE WORKED (FOR EXAMPLE, HULLED, ROLLED, FLAKED, PEARLED, SLICED, OR KIBBLED), EXCEPT RICE OF HEADING 1006; GERM OF CEREALS, WHOLE, ROLLED, FLAKED OR GROUND ROLLED OR FLAKED GRAINS: OF OTHER CEREALS | 5% | 01/07/2017 | ||
| 11042200 | CEREAL GRAINS OTHERWISE WORKED (FOR EXAMPLE, HULLED, ROLLED, FLAKED, PEARLED, SLICED, OR KIBBLED), EXCEPT RICE OF HEADING 1006; GERM OF CEREALS, WHOLE, ROLLED, FLAKED OR GROUND OTHER WORKED GRAINS (FOR EXAMPLE, HULLED, PEARLED, SLICED OR KIBBLED): OF OA | 5% | 01/07/2017 | ||
| 11042300 | CEREAL GRAINS OTHERWISE WORKED (FOR EXAMPLE, HULLED, ROLLED, FLAKED, PEARLED, SLICED, OR KIBBLED), EXCEPT RICE OF HEADING 1006; GERM OF CEREALS, WHOLE, ROLLED, FLAKED OR GROUND OTHER WORKED GRAINS (FOR EXAMPLE, HULLED, PEARLED, SLICED OR KIBBLED): OF MAI | 5% | 01/07/2017 | ||
| 11042900 | CEREAL GRAINS OTHERWISE WORKED (FOR EXAMPLE, HULLED, ROLLED, FLAKED, PEARLED, SLICED, OR KIBBLED), EXCEPT RICE OF HEADING 1006; GERM OF CEREALS, WHOLE, ROLLED, FLAKED OR GROUND OTHER WORKED GRAINS (FOR EXAMPLE, HULLED, PEARLED, SLICED OR KIBBLED): OF OTHER | 5% | 01/07/2017 | ||
| 11043000 | CEREAL GRAINS OTHERWISE WORKED (FOR EXAMPLE, HULLED, ROLLED, FLAKED, PEARLED, SLICED, OR KIBBLED), EXCEPT RICE OF HEADING 1006; GERM OF CEREALS, WHOLE, ROLLED, FLAKED OR GROUND GERM OF CEREALS, WHOLE, ROLLED, FLAKED OR GROUND | 5% | 01/07/2017 | ||
| 1105 | FLOUR, MEAL, POWDER, FLAKES, GRANULES AND PELLETS OF POTATOES | 5% | 01/07/2017 | ||
| 1105 | FLOUR, MEAL, POWDER, FLAKES, GRANULES AND PELLETS OF POTATOES | 0% | 01/07/2017 | ||
| 11051000 | FLOUR, MEAL, POWDER, FLAKES, GRANULES AND PELLETS OF POTATO FLOUR, MEAL AND POWDER | 5% | 01/07/2017 | ||
| 11052000 | FLOUR, MEAL, POWDER, FLAKES, GRANULES AND PELLETS OF POTATOES FLAKES, GRANULES AND PELLETS | 5% | 01/07/2017 | ||
| 1106 | FLOUR, MEAL AND POWDER OF THE DRIED LEGUMINOUS VEGETABLES OF HEADING 0713, OF SAGO OR OF ROOTS OR TUBERS OF HEADING 0714 OR OF THE PRODUCTS OF CHAPTER 8 | 5% | 01/07/2017 | ||
| 1106 | FLOUR, MEAL AND POWDER OF THE DRIED LEGUMINOUS VEGETABLES OF HEADING 0713, OF SAGO OR OF ROOTS OR TUBERS OF HEADING 0714 OR OF THE PRODUCTS OF CHAPTER 8 | 0% | 01/07/2017 | ||
| 110610 | OF THE DRIED LEGUMINOUS VEGETABLES OF HEADING 0713 | 5% | 01/07/2017 | ||
| 11061000 | FLOUR, MEAL AND POWDER OF THE DRIED LEGUMINOUS VEGETABLES OF HEADING 0713, OF SAGO OR OF ROOTS OR TUBERS OF HEADING 0714 OR OF THE PRODUCTS OF CHAPTER 8 OF THE DRIED LEGUMINOUS VEGETABLES OF HEADING 0713 | 5% | 01/07/2017 | ||
| 11061010 | GUAR MEAL | 0% | 15/11/2017 1/07/2017 | ||
| 11061090 | OTHERS | 5% | 01/07/2017 | ||
| 110620 | OF SAGO OR OF ROOTS OR TUBERS OF HEADING 0714 | 5% | 01/07/2017 | ||
| 11062010 | FLOUR, MEAL AND POWDER OF THE DRIED LEGUMINOUS VEGETABLES OF HEADING 0713, OF SAGO OR OF ROOTS OR TUBERS OF HEADING 0714 OR OF THE PRODUCTS OF CHAPTER 8 OF SAGO OR OF ROOTS OR TUBERS OF HEADING 0714: OF SAGO | 5% | 01/07/2017 | ||
| 11062020 | FLOUR, MEAL AND POWDER OF THE DRIED LEGUMINOUS VEGETABLES OF HEADING 0713, OF SAGO OR OF ROOTS OR TUBERS OF HEADING 0714 OR OF THE PRODUCTS OF CHAPTER 8 OF SAGO OR OF ROOTS OR TUBERS OF HEADING 0714: OF MANIOC (CASSAVA) | 5% | 01/07/2017 | ||
| 11062090 | FLOUR, MEAL AND POWDER OF THE DRIED LEGUMINOUS VEGETABLES OF HEADING 0713, OF SAGO OR OF ROOTS OR TUBERS OF HEADING 0714 OR OF THE PRODUCTS OF CHAPTER 8 OF SAGO OR OF ROOTS OR TUBERS OF HEADING 0714: OF OTHER ROOTS AND TUBERS | 5% | 01/07/2017 | ||
| 110630 | OF THE PRODUCTS OF CHAPTER 8 | 5% | 01/07/2017 | ||
| 11063010 | FLOUR, MEAL AND POWDER OF THE DRIED LEGUMINOUS VEGETABLES OF HEADING 0713, OF SAGO OR OF ROOTS OR TUBERS OF HEADING 0714 OR OF THE PRODUCTS OF CHAPTER 8 OF THE PRODUCTS OF CHAPTER 8: OF TAMARIND | 5% | 01/07/2017 | ||
| 11063020 | FLOUR, MEAL AND POWDER OF THE DRIED LEGUMINOUS VEGETABLES OF HEADING 0713, OF SAGO OR OF ROOTS OR TUBERS OF HEADING 0714 OR OF THE PRODUCTS OF CHAPTER 8 OF THE PRODUCTS OF CHAPTER 8: OF SINGODA | 5% | 01/07/2017 | ||
| 11063030 | FLOUR, MEAL AND POWDER OF THE DRIED LEGUMINOUS VEGETABLES OF HEADING 0713, OF SAGO OR OF ROOTS OR TUBERS OF HEADING 0714 OR OF THE PRODUCTS OF CHAPTER 8 OF THE PRODUCTS OF CHAPTER 8: MANGO FLOUR | 5% | 01/07/2017 | ||
| 11063090 | FLOUR, MEAL AND POWDER OF THE DRIED LEGUMINOUS VEGETABLES OF HEADING 0713, OF SAGO OR OF ROOTS OR TUBERS OF HEADING 0714 OR OF THE PRODUCTS OF CHAPTER 8 OF THE PRODUCTS OF CHAPTER 8: OTHER | 5% | 01/07/2017 | ||
| 1107 | MALT, WHETHER OR NOT ROASTED | 18% | 01/07/2017 | ||
| 11071000 | MALT, WHETHER OR NOT ROASTED NOT ROASTED | 18% | 01/07/2017 | ||
| 11072000 | MALT, WHETHER OR NOT ROASTED | 18% | 01/07/2017 | ||
| 1108 | STARCHES; INULIN - STARCHES : | 12% | 01/07/2017 | ||
| 11081100 | STARCHES; INULIN STARCHES: WHEAT STARCH | 12% | 01/07/2017 | ||
| 11081200 | STARCHES; INULIN STARCHES: MAIZE (CORN) STARCH | 12% | 01/07/2017 | ||
| 11081300 | STARCHES; INULIN STARCHES: POTATO STARCH | 12% | 01/07/2017 | ||
| 11081400 | STARCHES; INULIN STARCHES : MANIOC (CASSAVA) STARCH | 12% | 01/07/2017 | ||
| 110819 | OTHER | 12% | 01/07/2017 | ||
| 11081910 | STARCHES; INULIN STARCHES : OTHER: SAGO | 12% | 01/07/2017 | ||
| 11081990 | STARCHES; INULIN STARCHES : OTHER: OTHER | 12% | 01/07/2017 | ||
| 11082000 | STARCHES; INULIN INSULIN | 12% | 01/07/2017 | ||
| 1109 | WHEAT GLUTEN, WHETHER OR NOT DRIED | 5% | 01/07/2017 | ||
| 11090000 | WHEAT GLUTEN, WHETHER OR NOT DRIED | 5% | 01/07/2017 |
Why Do GST Rates Vary?
The GST rates for milling industry products are determined based on the level of processing and intended use:
- Essential food products (such as wheat flour and other basic cereals) attract a lower GST rate of 5% to keep staple foods affordable.
- Processed and value-added products (such as roasted malt, starches, and wheat gluten) attract a higher GST rate of 18%, as they involve additional processing and have industrial applications.
Impact of GST on Milling Industry Products
The GST framework affects various stakeholders in the milling industry differently, influencing pricing, tax liabilities, and overall market dynamics. Below is an overview of how GST impacts farmers, traders, manufacturers, retailers, and consumers: For Farmers & Traders
- Lower GST on raw milling products (such as unprocessed flour, groats, and meals) ensures affordability for consumers and benefits farmers and suppliers.
- A minimal tax burden on essential cereals helps stabilise market prices for staple foods.
Ensuring GST Compliance for Milling Industry Products
- Higher GST rates on processed products (such as starches and gluten) lead to increased retail prices.
- Bulk purchasing benefits for B2B buyers allow businesses to offset tax costs through ITC, while individual consumers bear the full tax impact.
For Retailers & Consumers
- Processed products (such as roasted malt and wheat gluten) attract higher GST, increasing production costs.
- ITC benefits on raw materials help reduce tax liability and improve cost efficiency.
For Processors & ManufacturersBusinesses dealing in milling products must adhere to GST regulations to ensure seamless operations and avoid penalties.
- Mandatory for interstate shipments exceeding ₹50,000 in value.
- Ensures smooth logistics and compliance with tax laws.
E-way Bills for Transporting Milling Products
- Businesses must file the following GST returns:
GST Return Filing
- Businesses must issue GST-compliant invoices, including:
Tax Invoicing Requirements
- Businesses with an annual turnover exceeding ₹40 lakh (₹20 lakh for special category states) must register for GST.
- E-commerce sellers must register for GST irrespective of turnover.
GST Registration Key Compliance Requirements For businesses dealing with milling industry products, understanding input tax credit (ITC) is essential to optimise tax benefits and reduce overall costs. Below is a detailedbreakdown of ITC eligibility and restrictions for milling products:What is ITC?
The input tax credit (ITC) mechanism allows businesses to offset the GST paid on purchases against their GST liability on sales, reducing overall tax costs.
- Personal use purchases are ineligible for ITC.
- Businesses under the GST Composition Scheme cannot claim ITC.
- Improper tax invoices and records result in ineligibility for ITC claims.
When ITC Cannot Be Claimed
- The product is used for manufacturing, resale, or trade.
- A valid GST invoice with HSN code and tax details is available.
- The business is registered under GST and files returns correctly.
Businesses can claim ITC on milling products if: ITC Eligibility for Milling Industry ProductsUnderstanding GST rates and HSN codes is essential for businesses dealing in milling industry products. While essential food products attract a lower 5% GST, value-added and industrial-use items fall under the 18% tax slab.Proper GST compliance, including accurate classification, timely filing, and ITC claims, ensures businesses optimise tax benefits and avoid penalties.By staying informed on GST regulations, businesses can maintain cost efficiency, pricing competitiveness, and smooth tax compliance in the evolving marketplace. Use a GST Calculator to determine tax liabilities and ensure accurate financial planning.
FAQS - FREQUENTLY ASKED QUESTIONS
What is the HSN code for wheat flour?
The HSN code for wheat flour is 1101, and it attracts 5% GST.
Are all cereal flour taxed at the same GST rate?
Yes, most cereal flours (excluding wheat/meslin) fall under HSN 1102 and are taxed at 5% GST.
What is the GST rate for malt?
Non-roasted malt (HSN 1107) is taxed at 5% GST.
Roasted malt attracts a higher 18% GST.
Why do starches attract 18% GST?
Starches (HSN 1108) undergo significant processing and are used in industrial applications, justifying the 18% GST rate.
Is wheat gluten taxable under GST?
Yes, wheat gluten (HSN 1109) is taxed at 18% GST.
Can a food processing business claim ITC on maize starch?
Yes, if the maize starch is used in taxable supplies, ITC can be claimed.
Are all milling products taxable under GST?
No, some raw cereals and grains are exempt, but most processed milling products fall under 5% or 18% GST slabs.
How can businesses ensure GST compliance for milling products?
By registering for GST, using correct HSN codes, maintaining proper invoices, and filing GST returns on time.
What happens if a business uses the wrong HSN code?
Incorrect classification may result in penalties, tax mismatches, and legal scrutiny.
Where can I check the latest GST updates for milling products?
Refer to the official GST portal or consult a tax professional for updates.
The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.
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