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Minister gives ‘sweet’ reply to GST confusions

As confusion prevailed over the tax rate for peanut candy under GST Union Minister, Nirmala Sitharaman, clarified that the tax for it under GST is just 5 pc and not 18 pc as widely assumed.

Minister gives ‘sweet’ reply to GST confusions
Nirmala Sitharaman at an interactive session on GST with traders in Madurai


An interactive session on GST was conducted here by the Madurai District Tiny and Small Scale Industries Association (MADITSSIA). Members from more than 100 trade associations participated in it and voiced their views and concerns. 

They expressed their grievances with brevity and submitted memorandums to Nirmala Sitharaman and R Saravana Kumar, Commissioner of Central GST and Central Excise of Madurai Commissionerate. 

During the interactive session, Saravana Kumar and his team clarified the doubts of the traders. Paramanandham from Idli Flour Manufacturing Association said that till date they were taxed 5 % of VAT for the wet flour but now they are taxed 18 pc. 

“More than 80 pc of the labourers are women and if GST is implemented the demand for the commodity might come down and hundreds of labourers will lose their jobs.” He also demanded the Minister to treat wet flour on par with perishable items like fruits and vegetables and exempt it from tax. 

Nirmala Sitharaman replied that idli flour is a problem specific one to Tamil Nadu and assured that she would raise the issue in the GST council. Similarly, representatives from Indian Bakery Association, pickle manufacturing association and matchbox manufacturing association demanded the government to reduce tax rate.  

Nirmala Sitharaman, said that confusions prevailed after implementation of GST and therefore ministers are meeting the traders associations in person to clarify their doubts. One common issue raised in the social media and among the public is that why there is only 5 pc tax for pizza and 18 pc for peanut candy. 

The issue had been understood wrongly by the public as only the bread used for making pizza costs 5 pc but the whole pizza after preparation is taxed 18 pc. As far as peanut candy is concerned the tax rate is only 5 pc under GST, said Nirmala Sitharaman.

Construction sector worst hit

Representatives from the construction sector claimed that they were worst affected by GST and demanded the Minister and union government to decrease the tax percentage and give temporary relief from paying interests on their bank loans. 

Kannadasan from Concrete Pavers and Blocks Manufacturing Association said that while they were paying 5 per cent tax preGST now most of the materials related to construction under GST had been raised to 28 percent. Cement, tiles, paints and so on are taxed 28 per cent, while materials like stone chips are fixed at 5 per cent. Because of the high tax structure, construction sector is one of the worst affected, he pointed out. 

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