A complicating topic even for the
government…
This is the reason why, the
government have decided to unify it as a single entity.
Single taxation system
GST, abbreviated as Goods and
service tax was initially introducedduring the budget session of 2007–08, which
finally came into existence last month.
All forms of indirect taxes were
abolished and a single taxation system was implemented.
People gave a mixed response
since they were not aware of the fact it would impact on the economic
development of our country.
Earlier, we pay Entertainment tax
for watching a movie and VAT (Value added tax) on purchasing goods and
services. Apart from all these taxes, there are many other diversifications
such as excise duties, import duties, luxury tax, central sales tax, service tax,
etc.
Bakery Industry post-GST
While bread has been exempted
from GST, biscuits have faced a uniform 18 percent tax that would have a huge
impact on the bakery industry. Pre-GST, the biscuits were priced at the range
of 70-700INR per kg. But after GST, the condition has worsened.
If sellers try to sell biscuits
below 100INR, it would result in levitation of tax percentage. Though it might
be beneficial to the end users, the service providers, here I mean the bakers
and suppliers would get affected at a larger rate.
18% GST
All categories of biscuits, flavored
refined sugar, pasta, cornflakes, pastries and cakes, come under the 18% GST.
The confusion
Though it is clear that the bread
is not taxable, it is a vain for the bakers that the same bread is 12% taxable
when it takes another form, such as Vada-Pav or sandwich. Here starts the
confusion. Even the common men would be confused on the taxable and non-taxable
goods.
Conclusion
Only if there is an awareness
created, the public would discover the positivity. And also, the bakers must be
given proper knowledge on what exactly is GST.