Nitish Kumar seeks exemption of 'langar' items from GST

Bihar Chief Minister Nitish Kumar sought an exemption of food prepared as 'langar' in Gurdwaras under the Goods and Services Tax (GST) structure.

In this regard, Kumar penned a letter to Finance Minister Arun Jaitley, seeking exemption of all inputs related to the provision of food through a langar (community kitchen) in the Sikh place of worship.

"It is my considered view that the levy of tax should be limited to activities which are undertaken in the course of business. In this context, you will agree that Gurdwaras are engaged in charitable activities and are well recognised as centres of selfless service. The most prominent of such activities is providing food through langars to anyone and everyone who visits a Gurdwara," he said.

Furthermore, Kumar argued that although food served through a langar is not liable to tax under GST, some significant inputs like sugar, ghee, edible oil, spices and so on are taxable.

"The tax on these inputs adds to the cost of the Gurdwara. Imposition of tax on the aforementioned inputs should be discouraged in view of the sanctity of the langar. Hence, food provided through a langar should be relieved of any tax burden," he added.

In July last year, Union Food and Processing Minister Harsimrat Kaur Badal had also urged Jaitley to exempt all purchases made by the Shiromani Gurdwara Parbandhak Committee (SGPC) for 'langar sewa' or service at the community kitchen, under the GST.

The SGPC spends around Rs. 75 crores to purchase desi ghee, sugar and pulses, all used in the preparation of food served in the Golden Temple in Amritsar. Citing this, the Minister said the committee would have to bear a financial burden of Rs. 10 crores on purchases, as they come under the 5 to 18 percent GST bracket.

On a related note, the Finance Ministry in July 2017 had stated that free food or 'prasadam' supplied by religious places like temples, mosques, churches and gurudwaras will not be subject to any Central, State or Integrated GST, as the case may be.

However, it noted that some of the ingredients and input services required for making the same, including sugar, vegetable edible oils, ghee, butter, service for transportation of these goods and so on, would be subject to taxation, as these good have multiple uses, making it difficult to be exempted under the GST.