Food May not Stay on Hot Plate for Long
Tomatoes & onions may be eating up home budgets, but prices of these & many others are set to fall
Jayashree Bhosale, Madhvi Sally & PK Krishnakumar
Pune | New Delhi | Kochi: Tomatoes have touched .₹ 100 per kg and onion prices are rising — but there’s good news on the horizon for households as the surge is expected to subside soon and kitchen budgets are likely to shrink as prices of a host of food items fall or remain steady.
For major food items, consumers are already getting the benefit of record food production in 2016-17 followed by good monsoon rainfall this year and incentives for farmers to sow more pulses, which have boosted planting.
The retail prices of some pulses have halved in the past six months and are expected to fall further while rice and wheat are steady. Improving the flavour of staples are cheaper garlic, pepper, turmeric and chillies, although jeera (cumin) and coriander are about 5% pricier than last year and cardamom is rising sharply.
Tomato supplies are likely to rise in two weeks. “Market will begin to cool when tomatoes from the Nashik belt begin arriving from August 15,” said Abrar Pathan, a trader based in Narayangaon. Higher supplies are likely to reduce prices after a week or two, traders said.
The overall situation has changed significantly after stubbornly high food prices since 2009, when India’s worst drought in four decades ravaged the kharif harvest and raised food inflation to 20%.
Any entity can claim credit of service tax or VAT paid in the previous regime against GST liability. If it does not have proof of payment of tax, it can take advantage of the deemed benefit provision.
The key benefit of GST is that there is no cascading of tax (tax on tax) through seamless availability of input tax credit.
Companies have to file form GSTR 3B, a summarised return, for July by August 20. That for August has to be filed by September 20. The format of this return includes a summary of details of outward supplies, inward supplies liable to reverse charges and input tax credit eligible on various pro- curements made during the month. But the form does not provide space for carryforward of credit from the earlier regime. This essentially implies that the GST liability for the months of July and August will have to be settled in cash.
CALL FOR CLARITY
There is a mechanism for claiming credit from the previous regime but that has not been integrated with the GST filing process. This transitional credit will be available only after filing of GSTR TRAN-1 on the GSTN common portal. Even if a taxpayer files TRAN-1 prior to August 20 (that is, prior to filing GSTR 3B for July), the credits would not be allowed to be migrated in GST as there is no specific table for disclosing opening credit in GSTR 3B. TRAN-1 and TRAN-2 are the forms for transition of input tax credit while GSTR 3B is the form in which actual GST payable is filed. To be sure, input tax credit can be availed of after September in all instances.
Tax experts are seeking a clarification or a change in the form.
“It can’t be the intention of the government to deny the benefit of input credit,” said Pratik Jain, leader, indirect taxes, PwC India. “It could lead to huge cashflow issues for industry, running into thousands of crores. A clarification or amendment in Form 3B is needed urgently.”