IBMA, in the SME sector face closure, GST at 18%

Why 18% GST on Biscuits when noodle GST rate is 12%.

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Media interaction with the association of Indian Biscuits Manufacturers’ Association, Mr. B P Agarwal, President, (IBMA) told that , “Biscuits are common product of consumption from a rickshaw puller to a low-wage laborer in search of hygiene, energy, nutrition at a low cost.

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Similar food products are subject to LOWER GST RATES, such as Sweets (5%), Processed Dry fruits (5%), Tea(5%), Juice, Namkeen, Jam/Jelly, Noodles, Pasta, Tomato Ketch-up (all 12%) but to utter surpise GST at 18% is imposed on Biscuit.

We urge the government to review their decision of imposing 18 % GST on Biscuit industry. There is urgent need to bring down the GST rate to 12% to avoid stagnation in growth of the industry” He further added that at the Proce level of Rs.5/- today the biscuit packet contains 50 grammes by weight , but if GST is not brought down to 5% , they may be forced to reduce this weight to 35 or 40 gms.

Biscuit manufacturers, especially in the SME sector, are hard hit because of unjustified imposition of Goods & Services Tax (GST) at a very high rate of 18%. The growth in the industry has started to stagnate since the imposition of the 18% GST and there is urgent need to bring down GST rate to 12%.

Biscuit is a mass consumption food product, hygienically processed and consumers of biscuit belong predominantly to the poorer segment but biscuits have been mistakenly understood to be a premium product, preferred for the consumption by the affluent society, whereas biscuit has been placed in the higher tax slab denying level playing field for biscuits in contrary  to  similar products.

Mr. Anoop Bector, MD of Cremica Biscuits was not present but send a note saying that “Biscuit is made of agricultural products like wheat, vegetable oil, sugar and milk and higher production of biscuit would benefit larger number of farmers.
Mr Shekhar Agrawal present made it known that Biscuit is highly Labour intensive, and stagnation in growth in production would adversely affect the industry which is estimated to provide employment to about 7.5 lakh workforce directly and more than 30 lakh persons indirectly in marketing, retail network, transport etc”.
All the people expressed that in case of any Natural calamity or Disaster the first consignment which is airlifted to the affected areas is packets of Biscuits and also it is in the World food programme and as such it is not a luxury but a essential food and basic necessity for the masses.
“Biscuit industry is subjected to escalation in cost of inputs/ingredients due to higher cost of transportation, fuel, packaging, wages etc.”added Mr. Pankaj Agarwal, CEO of Bonn Biscuits.
Swami Ramdev who was speaking to Sagar Media inc  Senior Correspondent , SAgrawal during the  launch of Patanjali Online expressed that GST needs to reviewed for lot of daily use items and also he was categorical in mentioning the Biscuit Industry which is under strain and the Government needs to may be have two slabs of taxes for biscuits of premium and ordinary category.
Concluding the Interaction it was proposed  that certain category of biscuit is like salt and even the Government may think of abolishing the tax structure applicable as this is a healthy food even being served to patients in the Hospitals and case of emergencies all over the country.
IBMA has informed that they have submitted detailed representation to the Hon’ble Prime Minister Mr. Narendra Modi, Union Finance Minister Mr. Arun Jaitley, Union Minister for Food Processing Industries Miss Harsimran Kaur Badal and also to the Finance Ministers of all states, who are members of the GST Council.

IBMA has also sought intervention and support from Members of Parliament from various political parties for favorable consideration of levy of GST at lower slab of 12%.
“Lowering the rate of GST on Biscuit would result in higher production and would not affect revenue to the Central and State Governments,” was the opinion expressed in a note by Mr. Deepak Bherwani, Director, Krown Biscuits.

The media meet of IBMA was attended by various medias and biscuits manufacturers in large number and showed keen interest on the ready made food of biscuits for all purposes.

Published by Naresh Sagar

Mentor MSME, Motivator, Media Event Org, Management fiscal & Water management.Social Media branding,Internet broadcasters,Propunder of Indian Philosophy

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