A 13-point tax gap can freeze a carton maker’s cash

Under what conditions can a refundable tax still squeeze orders and capital spending at a carton maker?

In September 2025, India raised the tax rate on major paper and paperboard products to 18%, while cutting the rate on eligible corrugated boxes and non-corrugated folding boxes to 5%. Input tax on eligible materials that cannot be fully offset can be refunded, but converters must bridge the time until payment with their own cash or borrowing.

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A 13-point tax gap can freeze a carton maker’s cash

Indian carton makers have begun advancing part of their materials tax to the state. Under India’s Goods and Services Tax (GST), major paper and paperboard products are taxed at 18%, while eligible corrugated boxes and folding boxes are taxed at 5%. The 13-percentage-point gap created on September 22, 2025 is putting pressure on converters’ working capital.…

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A 13-point tax gap can freeze a carton maker’s cash

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