GST impact on FMCG: Finance Ministry says only branded cereals will be taxed at 5 percent

By: |
New Delhi | Published: July 5, 2017 8:12:48 PM

The five percent GST on cereals will only be applicable on cereals which have been registered with the Register of Trademarks, while other cereals will remain exempt from GST.

GST impact on FMCG, Goods and Services Tax, GST, Finance Ministry, Trademarks Act, 1999, Goods and Services Tax, Register of TrademarksTrademarksThe five percent GST on cereals will only be applicable on cereals which have been registered with the Register of Trademarks. (Source: PTI)

GST impact on FMCG: The Finance Ministry has announced that a five percent Goods and Services Tax (GST) will be applicable on branded cereals such as Kellogg’s. The five percent GST on cereals will only be applicable on cereals which have been registered with the Register of Trademarks, while other cereals will remain exempt from GST. The Finance Ministry issued a clarification after doubts were raised over the meaning of registered brand names. A statement issued by the Finance Ministry read, ”A GST rate of five percent will not be applicable to the supply of goods unless the brand name or the trade name is actually on the Register of Trademarks and is in force under the Trademarks Act, 1999,” as reported by newswire agency IANS.

According to a PTI report, supply of such goods, when put up in unit container and bearing a registered brand name would attract CGST. The clarification comes amid doubts being raised with regard to the meaning of registered brand name for the purpose of GST.
The Goods and Services Tax which was rolled out by the government on first July has replaced 17 indirect taxes and 22 cesses with a single pan-India tax regime. Meanwhile, the tax rate for restaurants has gone down, as per the new tax regime the tax rate on restaurants has been reduced from 20.5 percent to 18 percent. Non-air conditioned restaurants will have to pay a levy of 12 percent. Restaurants which have a license to serve liquor will also be taxed at 18 percent, according to an Indian Express.

Do you know What is Securities Transaction Tax, Revenue Deficit, Centrally Sponsored Scheme, Non Tax Revenue, Non Debt Capital Receipts? FE Knowledge Desk explains each of these and more in detail at Financial Express Explained. Also get Live BSE/NSE Stock Prices, latest NAV of Mutual Funds, Best equity funds, Top Gainers, Top Losers on Financial Express. Don’t forget to try our free Income Tax Calculator tool.

Next Stories
1GST impact on octroi check posts: Effect on toll plazas varies across states, some abolish barriers, business as usual elsewhere; all you want to know
2Liquor ban across highways: Uttar Pradesh suffers Rs 5,000 crore loss post Supreme Court order
3GST shadow on world’s largest community kitchen