GST on paper increases from 12% to 18%

Business Sep 25, 2025

GST on paper and paperboard has recently increased from 12% to 18%, which means you can expect the price of things like textbooks, notebooks, and packaging to rise.
The paper industry says this move will hit students, small businesses, and anyone who relies on affordable paper.

Paper manufacturers are stuck with more working capital tied up

With the GST hike on raw paper but a lower tax on finished packaging (like cartons), MSMEs are stuck with more working capital tied up—over ₹500 crore—and complicated refund processes.

IPMA is urging the government to rethink this decision

The Indian Paper Manufacturers Association is urging the government to rethink this decision.
As IPMA President Pawan Agarwal puts it, "Paper is a necessity, not a luxury," arguing that taxing it at the highest rate goes against the goal of only targeting non-essential goods.