In a significant move to pass on the benefits of the recent Goods and Services Tax (GST) reforms, Amul has announced a reduction in the prices of over 700 dairy products. Effective from September 22, 2025, the price cuts encompass a wide range of items, including butter, ghee, cheese, paneer, ice cream, and other dairy products. This decision aligns with the government's GST 2.0 initiative, which aims to simplify tax structures and reduce consumer prices on essential goods.
GST 2.0 Reforms and Their Impact
The GST 2.0 reforms, implemented on September 22, 2025, introduced a two-slab tax system with rates of 5% and 18%, replacing the previous four-slab structure. Under this new system, essential items like milk and certain dairy products now fall under the 5% tax bracket, leading to reduced prices for consumers. The government's objective is to make daily necessities more affordable and stimulate consumer spending.
Amul's Price Reductions Across Product Categories
Amul, operated by the Gujarat Cooperative Milk Marketing Federation (GCMMF), has proactively adjusted the prices of its products to reflect the GST rate changes. Notable reductions include:
- Butter (100g): Reduced from ₹62 to ₹58
- Ghee (1L): Lowered from ₹650 to ₹610
- Processed Cheese (1kg): Decreased from ₹575 to ₹545
- Paneer (200g): Reduced from ₹99 to ₹95
- Ice Cream: Prices start at ₹9, down from ₹10
These adjustments are part of Amul's commitment to passing the full benefit of the GST rate cut to consumers. The company anticipates that these price reductions will boost demand for dairy products, particularly in categories like ice cream, cheese, and butter, where per capita consumption remains low in India.
Broader Industry Response
Amul's initiative follows similar actions by other dairy brands. Mother Dairy, for instance, has also announced price cuts on its products, including milk and dairy items, in response to the GST reforms. Additionally, Milky Mist Dairy Foods Ltd has reduced prices on 300 of its products and increased procurement prices for milk to support farmers. These collective efforts reflect the industry's alignment with the government's objective to make essential dairy products more affordable for consumers.
Consumer Benefits and Economic Implications
The price reductions are expected to have a positive impact on household budgets, especially for families that rely on dairy products as staple items. By lowering the cost of essential goods, the GST 2.0 reforms aim to enhance consumer spending and stimulate economic growth. The dairy sector's responsiveness to these changes underscores the industry's role in supporting both consumers and producers in a dynamic economic environment.
Conclusion
Amul's decision to reduce prices on over 700 dairy products demonstrates a proactive approach in aligning with the government's GST 2.0 reforms. By passing on the benefits of the tax rate cuts to consumers, Amul not only supports affordability but also encourages increased consumption of dairy products. This move is anticipated to have a ripple effect across the industry, promoting a more consumer-friendly market landscape.
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