’Exempt low-price biscuits from GST’


The Biscuit Manufacturers Welfare Association (BMWA) has petitioned Finance Minister Arun Jaitley to exempt low price high nutrition glucose, marie and milk biscuits from the ambit of Goods and Services Tax.

“We have no objection if premium biscuits – sold at Rs 100 kg and above – are put in the 18% tax bracket,” said Mayank Shah, vice president of the Biscuit Manufacturers Welfare Association.

As per the current tax regime, the government does not charge any excise duty on biscuits that are priced below Rs 100 per kg. But various state governments levy a value added tax of up to 12.5%.

Low priced biscuits account for 52 % of the total 36 lakh tonnes of biscuits production annually. In terms of value Rs 13,850 crore worth low price biscuits are sold every year as against the Rs 22,150 crore turnover of the premium variety.

“We operate at very low margins ranging between 2% and 3%. These are easily washed out by a surge in sugar, wheat and vegetable oil prices,” Haresh Doshi, President of the BMWA said.

The BMWA said as many as 240 big factories that manufacture only low priced biscuits will be forced to down shutters if the government decides to tax them at higher rates. Glucose biscuits were retailing at Rs 40 per kg in 1996 and after 20 years cost Rs 70 per kg.

“There has been an increase of 225% in input costs, but we have passed on only 75% to the consumer,” Doshi said.

Contending that their biscuits are hygenically produced, he said any hike in the prices on account of high taxes would lead to a shift in demand to poor substitutes that are manufactured without adherance to quality and nutrition norms.

Doshi argued that the biscuit industry contributes Rs 3000 crore to the exchequer annually and in no way want to shirk from the responsibility.

“But, premium biscuits such as oatmeal, cream, cheese and dry fruit cannot be taxed at par with low-priced biscuits,” Doshi said.

Write your Comments on this Article

Disclaimer: Please write your correct name and email address. Kindly do not post any personal, abusive, defamatory, infringing, obscene, indecent, discriminatory or unlawful or similar comments. Konkanworld.com will not be responsible for any defamatory message posted under this article. Please note that under 66A of the IT Act, sending offensive or menacing messages through electronic communication service and sending false messages to cheat, mislead or deceive people or to cause annoyance to them is punishable. It is obligatory on Konkanworld.com to provide the IP address and other details of senders of such comments, to the authority concerned upon request. Hence, sending offensive comments using Konkanworld.com will be purely at your own risk, and in no way will Konkanworld.com be held responsible. Similarly, Konkanworld.com reserves the right to edit / block / delete the messages without notice any content received from readers.

  • Konkan World
  • Stay Connected
  • Facebook Google+ Twitter YouTube

KONKAN WORLD offers accurate, up-to-date, a large collection of videos from KONKAN WORLD VIDEOS and indulge in fun you will not find else where!.
© Copyright 2014 Konkanworld media Inc