The proposed GST rate on sugar would have a neutral impact in all states barring Tamil Nadu and Andhra Pradesh. GST rate of 5% on sugar is tax neutral for most states which currently are paying around 5.5%. Sugar currently attracts a central excise duty of 71 rupees per 100 kg and a sugar cess of 124 rupees per 100 kg, which translates to a rate of about 5.5%. In Tamil Nadu and Andhra Pradesh, the effective tax rate including excise duty, cess and additional 5% value added tax comes to around 10% and the proposed GST of 5% would have a positive impact, making sugar cheaper.