The price of rice in Tamil Nadu will increase from Rs. 3 to Rs. 5 per kilogram on the basis of the government’s decision to levy a 5 per cent Goods and Service Tax (GST) on packaged food.
According to the Tamil Nadu rice mills association and traders, the centre has issued a notification that rice, maize, and other essential food commodities will be subject to less than 5% GST beginning July 18. Rice merchants and rice mill associations have urged the Tamil Nadu government to put pressure on the Union government to reverse the decision to bring food products under the purview of GST.
Around 3000 rice mills and thousands of rice merchants have protested against bringing the essential commodities under the GST slab.
The rice mill owners and rice merchants had, in a petition to Chief Minister M.K. Stalin, stated that, according to the Supreme Court rulings, GST recommendations are not binding for the state government.
Sivanandan, State Secretary, Tamil Nadu Rice Mill Owners Association, stated that the GST council had imposed taxes on registered rice brands in 2017 but had exempted unregistered brands.
The exemption is now withdrawn and all pre-packed rice brands will now have a 5 per cent GST. While loose rice may not fall under the ambit of GST, the state food department has directed all shopkeepers to ensure that rice and other food products are sold in packed form under the FSSAI Act.
Several mill owners, however, said that implementing a 5 percent GST from Monday may not be practical as many of these mills don’t have GST numbers. The mill owners want more time for the mills to get GST numbers.