AIFPP Urges Government to Classify Printing and Packaging Industry under 5% GST Slab 

Ludhiana, August 25, 2025: The All India Federation of Printers and Packagers (AIFPP), representing over 250,000 enterprises nationwide, held a pivotal virtual meeting today to discuss the Indian government's proposed GST rate rationalization. The reform aims to streamline the current multi-tier system by eliminating the 12% and 28% slabs, replacing them with a simplified two-tier structure of 5% and 18%, while introducing a 40% rate for select "sin goods" like tobacco products. With 96 print entrepreneurs in attendance, the session highlighted the potential ramifications for the printing and packaging sector, ending with a collective call to the government to classify the entire industry under the 5% GST slab to safeguard its growth and competitiveness.

The dialogue included expert perspectives from N.K. Thaman, a renowned GST law specialist, and Uday Dhote, a Mumbai-based printer and Chartered Accountant. They outlined the risks associated with the tax overhaul and advocated for supportive policies. "The printing and packaging industry is a cornerstone of India's economy," Mr. Thaman stated. "Increasing the GST rate to 18% could hamper innovation, raise operational costs, and diminish our competitiveness in global markets." He further advocated for retaining the current 5% GST slab, noting, "Maintaining the 5% rate would foster job creation, enhance export potential, and support the government's goal of tax simplification. Conversely, reducing GST on key raw materials from 12% to 5% while raising or keeping the 18% rate on printing and packaging would severely strain the industry's liquidity. Additionally, this shift would place the hosiery industry, a major customer, under an inverted duty structure, creating further economic challenges."

Dhote focused on the vulnerabilities of small-scale operations, noting, "Elevated taxes would inflate production expenses, affect essential packaging items and pass the burden onto consumers. This could impede the sector's recovery from the pandemic, especially for Micro, Small, and Medium Enterprises (MSMEs), which constitute the industry's core."
India's printing and packaging industry, valued at approximately USD 150 billion in 2025, serves as a key pillar of economic expansion. The packaging segment alone stands at over USD 101 billion in 2025 and is anticipated to expand to USD 170 billion by 2030, registering a Compound Annual Growth Rate (CAGR) of 10.73%. Meanwhile, the commercial printing market, estimated at USD 51 billion, is driven by robust demand in publishing, advertising, and flexible packaging solutions. The sector directly employs more than 2.5 million individuals and indirectly supports millions through ancillary chains such as paper manufacturing and logistics, positioning it as India's fifth-largest industry and a significant contributor to GDP amid surging e-commerce and consumer goods consumption.

Under the existing GST framework, various printing and packaging products attract rates of 12% or 18%: cartons, boxes, and corrugated paper at 12% (following a reduction from 18% in July 2024), while stationery like envelopes, registers, and diaries fall under 18%. The proposed merger could reassign 99% of items from the 12% category to 5%, but industry stakeholders worry that key services might migrate to 18%, potentially hiking production costs by up to 6% and disproportionately impacting MSMEs.

In response, the federation intends to present a detailed memorandum to the GST Council and pertinent ministries to foster sustainable development. Arvind Mardikar, Chairman of Hindustan Samachar, urged the AIFPP to champion the reclassification of the entire sector under 5% GST, emphasizing that this would improve affordability, benefit end-users, and fortify exports, which reached approximately USD 10 billion in 2024 for paper and related products. Mr. Mardikar committed to leveraging his resources to elevate the issue before the GST Council.

It may be mentioned here that the All India Federation of Printers and Packagers (AIFPP) is a premier advocate for India's printing and packaging ecosystem, uniting thousands of businesses across the country. Committed to ethical standards and innovation, AIFPP tackles policy hurdles and propels advancements in this essential sector for national economic progress.