GST to affect bakery and dairy products
As speculation surrounds the Goods and Services Tax (GST), many businessmen are unhappy. There is a lot of speculation among both consumers and shopkeepers about which goods will cost more from July 1.
Farook Shokri, owner of famous Kyani Bakery and Restaurant, said he is confused and feels that his business will decrease by 30% after implementation of GST.
“A general GST scheme is applicable when business turnover is above Rs 75 lakh. I come in this category and the bad part is if my customer buys products worth Rs 200 and eats in my restaurant, he has to pay 12% more. On the contrary if a restaurant next to me has a turnover of less than Rs 75 lakh he will not come under the 12% bracket. That means my customer will eventually go to my rival. I will lose business.”
A member from the Bakery Association said there are disparities as khari biscuits that were not taxed till now will be charged more.
“Britannia company biscuits come under the 18% tax slab under GST, but they produce 8-9 tonnes of biscuits an hour. Whereas WIDS makes khari biscuits in smaller quantities and still 18% tax is levied. Earlier khari biscuits had no tax, this is troubling,” said the member.
He added, “There is no tax on bread but if the same brun maska paav is served at the table, he will have to pay 12% more. There is a lot of confusion.”
Shokri said, “There should be only one tax slab. Instead there are different levels of taxes which are confusing: 5%, 12%, 18% and 28%. I have a bakery and a restaurant. If a customer eats any baked item at the restaurant he has to pay only 12% but if he purchases the same and takes home the parcel, he has to shell out more, as he will be charged 18%.”
Along with bakery products other items like ghee, dry fruits, cheese will come under 12% tax. Packet paneer will become costlier after GST which was not taxed till date.