Biscuits should be in lowest tax slab under the (GST) regime : FBMI

gst biscuit industry

Biscuits should be placed in the lowest tax slab under the Goods and Services Tax (GST) regime as they are items of mass consumption, the Federation of Biscuit Manufacturers of India (FBMI) has urged the GST Council ahead of its meeting on Saturday.

The Council, chaired by Finance Minister Arun Jaitley, is expected to vet the draft legislation to pave the way for the new indirect tax regime now proposed to be rolled out on July 1, and seek a resolution of other outstanding issues, including fitment of the indirect tax rates that would apply to different products. The body said that lower GST rates on biscuits will enable availability and access at affordable prices.

“It has been pointed out that almost 93% of the food basket comprises basic food,” FBMI said in a statement. “The government proposes to tax basic food at a lower rate under GST. Taxing the remaining 7% food items at higher rates under GST will lead to increase in complexity, without substantial addition to the revenues. It will also not meet the goals of efficiency and equity.”

A higher tax rate would cut down on procurement of raw materials by biscuit manufacturers adversely impacting farmers, it said.

 

The Hindu, 17 February 2017

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