The decision to impose a 5% GST on pre-packed and pre-labelled items such as food grains, curd and buttermilk is creating restlessness in local traders, with some demanding a nationwide protest over the move announced earlier this month.
Already peeved by the nationwide ban on single-use plastic, which came into effect on July 1, the traders said their earnings have also taken a hit due to rising inflation levels. They are demanding that the 5% tax on these goods be rolled back.
BC Bhartia, national president of the Confederation of All India Traders (CAIT), said that it is shocking that essential food grains have been brought under GST. The decision will only benefit big corporate houses at the cost of small manufacturers and traders. The business community, food grain associations, and APMC markets are worst affected by this.
Some traders also pointed out that there would be practical challenges to enforcing the tax in towns and rural areas. Forget about the challenges in towns and villages, even in cities like Gurugram and Delhi, this regime will result in harassment. It will open up avenues of corruption. They warned that the traders would need to shift the burden on consumers.
Last month, the Goods and Services Tax (GST) Council announced its decision to bring packaged food items like milk, curd, dried leguminous vegetables, makhana, wheat or meslin flour, jaggery, puffed rice, organic food, manure, and compost under the 5% tax slab.