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Letter to BS: Govt should refuse demand for GST rate cut by biscuit makers

The demand for exemptions and a "seamless system" of tariff mechanism and GST system is a self-contradictory demand

Business Standard 

Representative image
Representative image

This refers to "Top biscuit makers seek GST cut for below Rs 100/kg segment" (September 16). It is being argued that sales of cheaper biscuit packets have fallen due to higher goods and services tax (GST) being levied on them. The industry wants 5 per cent and not 18 per cent. I am writing to say that such demand should not be agreed to. The problem with the industry of all goods is that they keep on asking for exemptions and at the same time, they ask for a “seamless system” of tariff mechanism and GST system. This is a self-contradictory demand. The difference is 13 per cent, which is nominal and can be easily absorbed in the total cost of all biscuits of higher and lower price. The same lame logic the industry uses for footwear of cheaper and costlier variety and for cigarettes. Once the government imposes the same duty on cigarettes on the basis of size, these industries will have to adjust themselves to this same rate. So the government should straightaway refuse the demand for exemption for cheap biscuits. GST must not be ruined by such bogus lobbies.

Sukumar Mukhopadhyay

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First Published: Tue, September 17 2019. 21:36 IST