Published On : Thu, Sep 7th, 2017

CAIT urges GST council to rationalise tax system

CAIT and GST
Nagpur:
Having an eye on the forthcoming meeting of GST Council scheduled to be held on 8th September at Hyderabad, the Confederation of All India Traders (CAIT) today drawn attention of the Union Finance Minister Shri Arun Jaitley towards anomalies, disparities and contradictions of GST​ and mal-functioning of GSTN portal,​ in order to provide ease of complying GST provisions for the traders. ” The non smooth working of the GSTN portal on the one side and confusions pertaining to procedures have fractured GST to an extent and if remedial measures are not taken, it is feared that people will find them distracted from GST”-said the CAIT.

CAIT National President B.C.Bhartia and Secretary General, Praveen Khandelwal hoped that GST Council will have serious deliberations on the tax and procedural issues raised by CAIT and other Organisations. Irrationality of 28% tax slab under GST will be looked in to and items not falling under luxurious and demerit category but have been placed in 28% tax slab shall be brought back to lower tax segment. They further said that 28% tax slab is considered as one third cost of the product by the Consumers and therefore resisting them to pay 28% tax. This anomaly needs to be rectified in order to make GST affordable at the level of consumers. About 1200 items have been classified so far under different tax slabs and out of which about 19% items have been placed under 28% tax slab which in itself puts a question mark on the rationality of 28% tax slab which was specifically designed for levy tax on luxurious and demerit goods.​ Likewsie food grains are tax exempted if not branded and if branded then levy of 5% tax has created a major distortion and GST Council should take remedial measures.​

Both said that items like spare parts of two wheeler, three wheeler and four wheeler, housing necessity items like Cement, Building Hardware, Paints, Marble, Furniture, Sanitary ware, Electrical Fittings, Beauty & Cosmetic Products, Polishes & Creams for footwear, scientific instruments, are some of the prominent items which falls under this category and can not be termed either luxurious or demerit goods. These are general consumables in nature and are being used by common men.

CAIT demands consideration of GST council to reduce the GST tax rate of 28% to a lower slab for malt/cereal-based health food drinks like Horlicks, Amul Pro, Boost, Bournvita, Complan etc. especially for children upto 18 years of age and women. These products are food items of mass consumption and critical to meet nutritional requirements of children and women and consumed by over 30 crore people across economic and social strata and sold by over 40 lakh retailers across India. Since reduction of such rate will be passed on to the consumer this will greatly increase affordability of nutrition products like malt/cereal based health food drinks among school-aged children up to age 18 under the GST and mothers who need them. ​Likewise Icecream manufacturers have been denied Composition Scheme in GST though under VAT regime, they were enjoying this scheme. They should also be allowed to take advantage of Composition Scheme.​

On the other hand recycle products/scrap collection items like empty used glass bottles have been placed under 12%, Washing Soap, Laundry Soap and Toilet Soap though different from one another have been clubbed together and placed under 18% and other such items may be placed under lower tax slab.

The CAIT has urged that Sanitary Napkins essential for Women Hygiene must be removed from 12% tax slab and placed under exempted category like contraceptives. No logic can stand with this item since even today in large part of the Country is deprived of use of Sanitary Napkins and efforts must be made to make these available free of cost under social responsibility to women in villages and remote areas instead of levying 12% tax on them.

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Sunita Mudaliar - Executive Editor
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