Introduction
Industry welcomes the Government’s continued efforts towards GST rationalisation, particularly the recent reduction in GST rates on select consumer products. The reduction of GST on talcum powder and face powder from 18% to 5% vide Notification No. 9/2025 –Central Tax (Rate) dated 17 September 2025 is a commendable step that enhances affordability, promotes consumer welfare, and supports a more balanced tax framework for industry. Such rationalisation measures reinforce ease of doing business and foster fair competition across product categories.
Issue at Hand
Despite the above rationalisation, cornstarch-based powders, which are widely used in baby care and serve the same end-use as talcum powder, continue to attract 18% GST under HSN 3304 91 90 (Others). This has resulted in an unintended disparity, even though:
- Cornstarch-based powders are functionally similar to talcum powder, particularly in baby care applications, as both help keep skin dry, soft, and comfortable.
- From a consumer perspective, both products are perceived and purchased interchangeably as baby powders.
- Both product categories are largely substitutable, with minimal difference in retail pricing.
- Cornstarch-based powders are plant-based, talc-free, and offer additional consumer and environmental benefits.
Importantly, cornstarch is a recognized and approved base ingredient for baby powders under Indian regulatory standards. Indian Standard IS 5339:2021 (Third Revision) – Skin Powder for Infants, issued by the Bureau of Indian Standards, categorises infant skin powders as:
- Type 1: Talc (minimum 90%)
- Type 2: Starch (minimum 90%)
- Type 3: Talc and starch in any combination (total minimum 90%)
This clearly establishes cornstarch-based powders as an accepted and equivalent category for infant care products under Government of India standards. Further, while talcum powder (HSN 3304 91 20) and face powder (HSN 3304 91 10) are now taxed at 5% GST, cornstarch-based powders—despite comparable usage—remain excluded and fall under the residual category attracting 18% GST, creating an uneven playing field.
Recommendation
In light of the functional equivalence, regulatory recognition by BIS, comparable consumer perception, and sustainability advantages of cornstarch-based powders, industry respectfully recommends that cornstarch-based powders be included under the reduced GST rate of 5%, either through appropriate clarification or alignment within the relevant GST schedule.
Conclusion
The present GST treatment of cornstarch-based powders appears to be an inadvertent omission rather than a policy intent. Aligning the GST rate for cornstarch-based powders with talcum and face powders would ensure tax parity across similar-use products, promote fair competition, and support consumer access to safer, plant-based baby care alternatives. Industry respectfully requests CBIC’s kind consideration of this matter in the spirit of GST rationalisation and equitable taxation. The present GST treatment of cornstarch-based powders appears to be an inadvertent omission rather than a policy intent. Aligning the GST rate for cornstarch-based powders with talcum and face powders would ensure tax parity across similar-use products, promote fair competition, and support consumer access to safer, plant-based baby care alternatives. Industry respectfully requests CBIC’s kind consideration of this matter in the spirit of GST rationalisation and equitable taxation.
