October 1, 2023


Passion For Business

TN opposes move to hike GST on coconut oil in less-than-1-litre pack to 18%

Tamil Nadu strongly opposed the go to improve GST charge on packed edible coconut oil of a lot less than one particular litre to eighteen per cent from 5 per cent, terming the proposal anti-very poor, anti-Southern States, which generate bulk of the coconuts, and anti-Indian as it will support other imported oils.

“The basic theory of fairness requires that we are unable to solitary out a south-Indian centric domestic oil for a 360 per cent GST charge improve, while leaving other Indian and imported oils at 5 per cent,” the State Finance Minister Palanivel Thiaga Rajan mentioned at the forty fifth GST Council Assembly on Friday. The Fitment Committee advisable that keeping in intellect the common shopper use pattern of this kind of merchandise, that coconut oil, when packed and marketed in a unit container of a lot less than one litre may be categorized as hair oil (beneath Chapter 33), attracting a GST charge of eighteen per cent irrespective of its actual finish use. The edible coconut oil, when packed and marketed in a unit container of one particular litre or higher than, is subject matter to GST at the charge of 5 per cent.

‘Biased approach’

“We obtain this suggestion to be perverse and lacking in both logic or fairness. In truth, we will go so much as to consider this selection to have been designed with lousy faith intent, against the interest of Tamil Nadu which is one particular of the premier producers of coconuts and coconut oil, and indeed several of the southern states this kind of as Kerala, Andhra Pradesh and Karnataka,” Rajan mentioned.

“How can you classify something which is clearly edible as properly non-edible (based on the dimension of the container) for the sake of levying GST? How do you determine on one particular litre as the cut-off for even contemplating no matter if something is supposed for edible use or not?”, he questioned.

Also see: WTO talks: India wants exemption from curbs on subsidy for fishers

Rajan questioned as to why really should only coconut oil be singled out for this treatment method in comparison to other edible oils with several takes advantage of, this kind of as mustard oil or gingelly oil? When the Central governing administration has selected to exempt imported oils this kind of as palm oil or olive oil from import duties, south-Indian oil is staying discriminated against, he said.

Tamil Nadu also opposed the proposal to levy a better charge of eighteen per cent on work work by agreement brands to the model house owners for the manufacture of alcoholic liquor for human intake.

’IGST hit’

Also, there is a proposal advisable by the regulation committee to permit the IGST refund route to only certain courses of exporters. “Presently, close to 70,000 exporters avail the IGST route for refunds. If the proposal is accepted, this will be minimized to about ten,000. This will undoubtedly adversely impact export activity,” he mentioned.