Difference between GST and FSSAI license
Difference between GST and FSSAI license
If you are running or planning to start a food business in India, understanding GST registration is crucial for legal compliance, smooth operations, and growth. Many food entrepreneurs often confuse Goods and Services Tax (GST) with food safety licensing like FSSAI, but these are distinct requirements that serve different regulatory purposes. In this article, we’ll answer common questions such as whether GST registration is mandatory for food businesses, how to apply online, whether you can get an FSSAI license without GST, what the threshold limits are, and how GST differs from the FSSAI license.
GST registration becomes mandatory for food businesses based on specific criteria, primarily annual turnover and the nature of your sales. The Goods and Services Tax (GST) is a destination-based tax on the supply of goods and services, and any business whose annual turnover exceeds the prescribed threshold must register under the GST law. For the supply of goods, this threshold is currently around ₹40 lakh per year (lower for special category states), and for services, it is about ₹20 lakh per year. Even if your turnover is below these limits, you still must register for GST if you supply goods or services across state borders or sell products online through e-commerce platforms like Swiggy, Zomato, Amazon or Flipkart. In such cases, GST registration is compulsory regardless of turnover.
This means that many food businesses — especially restaurants, caterers, cloud kitchens and packaged food sellers — will need GST registration to operate legally and issue GST invoices. Without it, your business could face penalties and compliance issues with tax authorities.
The process to apply for GST registration online is straightforward and fully digital. You must visit the official GST portal, create a user account, and fill out the GST REG-01 form with details like your PAN (Permanent Account Number), Aadhaar number, business address, and bank account information. Along with the application, you must upload supporting documents such as your PAN card, proof of business registration, identity and address proofs, and a photo of the proprietor or directors. After submission, the portal verifies the information, and once approved, you will receive your GSTIN (Goods and Services Tax Identification Number). It is important to apply within 30 days of becoming liable to register to avoid penalties.
This online registration ensures your food business is recognised as a taxable entity, able to collect and remit GST as required.
Yes, you can obtain an FSSAI license or registration without having a GST registration, provided you are not liable for GST based on turnover or interstate/online sales. The FSSAI (Food Safety and Standards Authority of India) regulates food safety, quality standards and compliance for all food businesses, irrespective of tax thresholds, and requires every food operator to register under the FSSAI regime depending on the type and scale of operation.
However, if your food business is liable for GST, you may be asked to provide your GST details during the FSSAI application for documentation purposes. Even though GST is not a strict prerequisite for FSSAI, having both registrations helps build credibility and ensures comprehensive compliance with food safety and tax regulations.
A key question food entrepreneurs ask is what the GST threshold limit is before registration becomes mandatory. Generally, if your aggregate annual turnover in a financial year exceeds ₹40 lakh for goods, GST registration becomes compulsory. For services, the threshold is ₹20 lakh. In certain special category states (such as those in the Northeast or hilly regions), these thresholds are even lower.
Even if your turnover remains below the threshold, other conditions such as interstate supply or e-commerce sales trigger GST liability. Therefore, understanding these limits and monitoring your revenue growth is essential to ensure you register before you cross these limits to avoid late fees or penalties.
GST and FSSAI might seem similar because both involve registering your business with a government portal, but they cater to different legal purposes. GST is a tax compliance requirement under the GST Act, ensuring that your food business pays and reports the correct tax on supplies. Without GST registration, you cannot legally collect GST from your customers or claim input tax credits from purchases.
FSSAI, on the other hand, is a license or registration under food safety law (Food Safety and Standards Act, 2006) that certifies your food products and operations meet the required safety and hygiene standards before they reach consumers. It is mandatory for every food business operator in India, regardless of turnover, to obtain the correct category of FSSAI registration or license (Basic, State, or Central) based on annual turnover and business scale.
In simple terms, while GST focuses on tax compliance, FSSAI ensures food quality and safety — both are necessary for a food business to run legally and responsibly.
If you’re still unsure about GST, FSSAI, or how they apply to your food business, feel free to get expert help. Shugam Consultants can guide you through the entire application process for GST, FSSAI, and other compliance needs, so you can focus on growing your business with confidence.