GST: Why almonds going nuts vis-a-vis cashew

The government needs to rethink and bring all nuts, including almonds, under a uniform rate under the Goods and Services Tax (GST), a senior official of the Almond Board of California (ABC) said today.
"For us we are clear - all nuts should be at same tax rates of 5 per cent," the Board's Regional Director, India, Sudarshan Mazumdar told PTI here.
Initially, all the nuts and dry fruits were put in the 12 per cent tax bracket under GST but the Centre subsequently reduced it to 5 per cent only in respect of cashew and raisins.
"Actually, we look at almonds as fresh nuts because it comes straight from tree and there is no further processing. Now, this is strange for us... In fact if you look at since (India's) independence all the nuts have always been on the same tax bracket.

"They were never differentiated...For the first time we are finding that a differentiation is happening...For us the reasons are not clear why it is happening. There is an effort to pull out a couple of nuts and put them in different tax brackets," he said.
Mazumdar hoped the government would reconsider its decision and levy a common GST rate of 5 per cent across all nuts so there is no discrimination among these dry fruits.

He said some dry fruits and kirana associations and traders have approached the government with representations to make the tariff structure equitable across nuts.
"For us, all nuts should be (taxed) at same rates... otherwise you are causing distortion in the market because you are forcing people to choose one nut over the other through the tariff instead of the natural demand growth."

On the volume of California's almond exports to India, he said, "From August 2016 to May this year, we have already shipped 147 million pounds. It is a huge growth as compared to 126 million pounds in 2015-16."
Spain is the largest importer of California almonds from the US at 175 million pounds, followed by India at 147 million pounds and China 132 million pounds. Spain is not essentially a consumption centre of almonds and acts as a processing facility for all of Europe. From consumption perspective, India is still the largest market, he explained.
Mazumdar claimed during the January to December 2016 shipments, California almonds had 81 per cent share in India followed by Australian almonds at 13 per cent and Iran at 3 per cent.

According to him, "People are getting comfortable with the health benefits of almonds."
He said the Board is focusing on building the market in India, continuing to do research on the health benefits, and educating consumers on the different ways they can have almonds as snack.
"Our basic focus is on increasing snacking in India. We feel there is a huge opportunity for afternoon, mid-morning snacking to increase in India and we are seeing through our studies that people are consuming almonds more and more in afternoon and mid-morning," the official said.
Mazumdar said they see a role for almonds replacing a lot of unhealthy snacks for mid-morning and afternoon consumption.

"While some people plan for healthy meals, they forget it during snacking. We want to encourage people to have healthy snacking in which almonds can play an easy role," he added.
ABC is an international almond industry body that engages in production, nutrition and market research, advertising and promotion, quality control and statistical analysis and dissemination.