AFCCI Madurai calls for exempt of daily food items from GST
The definition of agricultural produce given under GST notifications includes not only cereals and pulses but also all products like rice, dhal (split pulses), flour, maida, atta and rava (sooji) of wheat even though processed in a milling factory.
Representative image
CHENNAI: Agro Food Chamber of Commerce and Industry (AFCCI), Madurai, strongly objected to taxing rice, a staple food.
Rice is considered a ‘manufactured produce’, whereas wheat is treated as an ‘agricultural produce’.
The definition of agricultural produce given under GST notifications includes not only cereals and pulses but also all products like rice, dhal (split pulses), flour, maida, atta and rava (sooji) of wheat even though processed in a milling factory.
“For taxation cereals and pulses become consumable only after such processing, which does not alter its essential characteristics,” S Rethinavelu, president, AFCCI, Madurai said on Monday.
A conundrum is prevailing in the taxation of food items of daily consumption under the GST.
The primary reason is that the GST is not levied based on food products, but based on irrelevant matters such as whether the products bear a registered brand name, are already packed or packed in the presence of the consumer, whether pre-packed or labelled as per the provisions of the Legal Metrology (Packaged Commodities) Act and Rules.
Taxing products as per the provisions of a different enactment is causing utter confusion and increasing the compliance cost of the assessments.
The long pending demand of the AFCCI and the general public is the total exemption of tax for all food items of daily consumption.
Citing these, he requested the Union Finance Minister Nirmala Sitharaman to accept this populous demand at this appropriate time when our average monthly GST collection exceeds Rs 1.7 lakh crore, he said.
