MADURAI: The Agro Food Chamber of Commerce and Industries requested the union government to reform GST, to boost economic growth in the country.
In a statement, the chamber’s founder and president S Rethinavelu stated that GST collection in April 2024 surpassed Rs 2 lakh crore for the first time since its inception.
The chamber’s members opined that the increase in GST collection is attributable not just to the economic growth, consumption and compliance, but also to the higher rates of taxation as compared to the profit margins and heavy penalty and interest, on account of unintelligible and complicated provisions of the act and rules.
People have no other option but to pay these heavy indirect taxes, and the rise in tax collection is an indicator that it is time for remedial measures to rationalize tax rates and simplify compliance procedures.
Other than tax exemption, only three GST slabs must exist, the statement read.
All agricultural food produce in its primary form, either in the hands of the farmers or traders, till it reaches the consumers, and all other essential commodities must be fully exempted from GST. All processed and value-added manufactured food products and other daily necessities must be brought under the 5% GST slab, while other products can be in the 10% GST slab. Luxurious goods should be taxed at 15%, and the benefits of Input Tax Credit (ITC) should neither be denied nor restricted, they stated.