CHENNAI: Tamil Nadu Finance Minister D Jayakumar on Saturday demanded that all food items, whether branded or not, be nil rated under the Goods and Services Tax (GST) regime.
Participating in the crucial meeting on Goods and Services Tax (GST) held at New Delhi, the minister urged the Centre to revisit the tax proposed to levied on a host of items in the interest of the common man.
Speaking at the GST meeting, the minister said, “Cereals like rice, wheat, barley, etc have been exempted as per the unanimous decision of the council. However, the same items sold in unit containers and bearing a registered brand name have been brought under the five per cent category. We would reiterate that all food items, whether branded or not, should be nil rated. Atta, maida, besan and other flours may also be treated similarly.”
Jayakumar said water sold in refill cans (bubble top) and small plastic pouches should be distinguished from water sold in bottles as the former were consumed by the lower strata of society as an essential commodity.
“We strongly urge that the first two categories be exempted or taxed at a lower rate of five per cent,” he added.
“Films are proposed to be levied with 28 per cent tax. Tamil Nadu has a policy of exempting levy of tax on films made in the local language. We would urge that the tax be reduced for local language films,” the minister said.
He said that as far as jewellery was concerned, a distinction should be made between handmade jewellery and machine-made jewellery as handmade jewellery was made by small artisan and the jewellery was consumed by common folk.
The minister also pointed out that most of the match factories in the State were either semi-mechanised or fully mechanised units. Considering the input tax embedded in raw materials there on both semi-mechanised and fully mechanised safety matches, tax rate should be reduced to 12 per cent instead of the proposed rate of 18 per cent so that the MRP price per match box could be kept at less than one rupee.
He said palmyra jaggery (gur) known as karupatti and palmyra sugar known as panangalkandu were traditional cottage industries and were also organic products. “As they are not specifically mentioned in the schedule, they are likely to be charged at 18 per cent. We request that karupatti may be mentioned in the Schedule along with cane jaggery in chapter 17, item 1,” Jayakumar added.