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  1. Budget 2018: Branded Atta, Maida, Besan may cost you less, here is what Centre can do

Budget 2018: Branded Atta, Maida, Besan may cost you less, here is what Centre can do

Budget 2018: Goods and Services Tax (GST) has completely changed the tax structure of the country. The upcoming Union Budget 2018 will be crucial as it will be the first one since the implementation of GST last year.

By: | New Delhi | Updated: January 19, 2018 6:28 PM
budget 2018, union budget 2018, budget 2018 date, ficci, gst, Goods and Services Tax, Branded Atta gst, atta gst, branded maida gst, branded besan gst, maida gst, besan gst Budget 2018: Goods and Services Tax (GST) has completely changed the tax structure of the country. The upcoming Union Budget 2018 will be crucial as it will be the first one since the implementation of GST last year.

Budget 2018: Goods and Services Tax (GST) has completely changed the tax structure of the country. The upcoming Union Budget 2018 will be crucial as it will be the first one since the implementation of GST last year. FICCI has suggested that central government should exempt GST on wheat flour put up in unit container and bearing a registered brand name. “The Government has ensured that all basic household staples, including Branded Bread are kept at taxation levels under GST that are equivalent to or lower than the tax incidence on these goods in the pre-GST regime. In line with this position atta should also be kept at ‘Nil’ rate of GST – more so since roti made from atta is a staple food for Indian households,” FICCI says.

“Flour [1101, 1102, 1105, 1106] Atta, maida, besan etc. (other than those put up in unit container and bearing a registered brand name) are taxed at “Nil” rate of duty under GST whereas, when the identical goods are packed in unit containers bearing a registered brand name the rate of GST has been set at 5%,” FICCI says. “In fact, as many as 21 States did not levy any tax, on branded packaged wheat flour under the erstwhile regime. The incidence of VAT on Maida and Atta was prevalent only in a few States in the pre-GST regime,” the industry body says.

There was no distinction between branded and unbranded products in this category. The average VAT rate was less than 2% and there was no levy of Excise Duty. The levy of GST at 5% will not ensure tax neutrality, given that the value addition is limited and thereby the input credit is also limited, the FICCI says.

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Branded Maida or Atta meeting the daily food requirements of ordinary common man should be put under Nil tax structure irrespective of its bearing any brand name or being marketed in a unit container as it only signifies hygienic and quality processing of wheat products meeting the FSSAI specifications and taxation at any stage is bound to add to the cost of the product, FICCI said.

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FICCI has recommended that four (Atta, Maida, Besan) put up in unit container and bearing a registered brand name under HSN 1101 should be made liable to nil rate under the GST regime.

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