Agro-food chamber calls for GST reformation

MADURAI: In view of the 2024 Goods and Services Tax (GST) collection, the Agro Food Chamber of Commerce and Industry (AFCCI), Madurai, opined that besides attributing to the economy, the surge in collection also results in higher rates of taxation than the profit margin and heavy penalty and interest on traders.

The consumers have no other way except to pay this unfair and heavy indirect taxation amount. It is the need of the hour to take the necessary steps to ensure the rationalisation of tax rates and simplification of compliance procedures.

The AFCCI thus suggested that there should be only three GST rates, viz. 5, 10, and 15 for Goods and Services rather than a higher rate for sin goods besides tax exemption.

Elaborating further, S Rethinavelu, president, of AFCCI, Madurai said on Saturday, “All agricultural food produced in its primary form should be under the control of farmers or traders till it reaches the consumers. All the other essential commodities should be fully exempted under GST.”

All processed and value-added manufactured food products and other goods of importance should be brought under the 5% GST rate, he said. All other Goods and Services should attract a GST rate of 10%. Luxurious goods should be taxed at 15% and sin goods may be changed at a much higher rate restricting consumption, it added.

The benefits of Input Tax Credit (ITC) should neither be denied nor restricted to any assesse, as this will lessen the cascading effect on the price due to tax on tax. In consultation with Trade and Industry, the GST Act and Rules should be simplified to reduce the cost of compliance, said the AFCCI.

Therefore, the Chamber requested the new Union Government to be formed in June 2024, to take up the next generation of GST reforms to accelerate the growth of our economy towards ‘Developed India’.