India RegionAgriculture Industry

Demand to abolish GST on branded pulses and cereals: India Pulses Industry

25 January 2022, New Delhi: Goods and Services Tax (GST) of 5 percent on branded pulses and cereals has increased the hardship of the industry-trade sector as well as the common consumers and many traders-entrepreneurs are forced to exit the branded market. . It is to be noted that non-branded products of these commodities have been kept out of the purview of GST, due to which manufacturers and traders of branded products are not getting equal level of competition.

In the name of GST, the retailers charge higher price from the consumers which they feel has increased the price of pulses.

In their pre-Budget memorandum, grains and pulses traders have demanded the Union Finance Minister to withdraw GST on branded cereals and pulses. Apart from pulses, a GST of 5 per cent is also levied on other cereal products including branded rice and wheat flour. But there is no GST on unbranded products. It is noteworthy that the GST has been levied on branded food products since July 2017.

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Industry-trade organizations and traders have been making a strong demand from the government to remove GST for a long time, but till now it has not been accepted. Since the implementation of GST, the business of branded food products is continuously shrinking. Brand means assurance of the quality of the product for consumers. As the government also wants to discourage trading in bulk or open form as there is a possibility of adulteration, this demand should be listened.

The industry-trade sector says that for the first time after independence, any tax has been imposed on cereals and pulses. These essential products of daily use should be kept out of the purview of tax. After the implementation of GST, the export of branded pulses from the country has been blocked. The government should immediately reinstate this subsidy. It has been said in the memorandum that due to frequent changes on the import policy of pulses, there is an atmosphere of uncertainty in the market. The government should make a permanent policy for at least one year, even if minimum import duty is imposed on it.