Urgent Need to Lower GST Rate on Biscuit To 12%

  • Since the imposition of 18 % GST, the growth of the industry has started to stagnate
  • Biscuits are common product of consumption from a rickshaw puller to a low-wage laborer in search of hygiene, energy, nutrition at a low cost
  • Biscuit is made of agricultural products like wheat, vegetable oil, sugar and milk and higher production of biscuit would benefit larger number of farmers

New Delhi, January 16th, 2018: Biscuit manufacturers, especially in the SME sector, are hard hit because of unjustified imposition of Goods & Services Tax (GST) at a very high rate of 18%. The growth in the industry has started to stagnate since the imposition of the 18% GST and there is urgent need to bring down GST rate to 12%. Biscuit is a mass consumption food product, hygienically processed and consumers of biscuit belong predominantly to the poorer segment but biscuits have been mistakenly understood to be a premium product, preferred for the consumption by the affluent society, whereas biscuit has been placed in the higher tax slab denying level playing field for biscuits vis-à-vis similar products.

“Biscuits are common product of consumption from a rickshaw puller to a low-wage laborer in search of hygiene, energy, nutrition at a low cost. Similar food products are subject to LOWER GST RATES, such asSweets (5%), Processed Dry fruits (5%), Tea(5%), Juice, Namkeen, Jam/Jelly, Noodles, Pasta, Tomato  Ketch-up (all 12%) while  GST at 18% is imposed on Biscuit. We urge the government to review their decision of imposing 18 % GST on Biscuit industry. There is urgent need to bring down the GST rate to 12% to avoid stagnation in growth of the industry”, said Mr. B P Agarwal, President, Indian Biscuits Manufacturers’ Association (IBMA).   

Mr. Anoop Bector, MD of Cremica Biscuits added that “Biscuit is made of agricultural products like wheat, vegetable oil, sugar and milk and higher production of biscuit would benefit larger number of farmers. Biscuit is highly Labour intensive, and stagnation in growth in production would adversely affect the industry which is estimated to provide employment to about 7.5 lakh workforces directly and more than 30 lakh persons indirectly in marketing, retail network, transport etc”.

“Biscuit industry is subjected to escalation in cost of inputs/ingredients due to higher cost of transportation, fuel, packaging, wages etc.”added Mr. Pankaj Agarwal, CEO of Bonn Biscuits.

IBMA has already submitted detailed representation to the Hon’ble Prime Minister Mr. Narendra Modi, Union Finance Minister Mr. Arun Jaitley, Union Minister for Food Processing Industries Miss Harsimran Kaur Badal and also to the Finance Ministers of all states, who are members of the GST Council. IBMA has also sought intervention and support from Members of Parliament from various political parties for favorable consideration of levy of GST at lower slab of 12%. “Lowering the rate of GST on Biscuit would result in higher production and would not affect revenue to the Central and State Governments,” said Mr. Deepak Bherwani, Director, Krown Biscuits.

IBMA has requested for meetings with the Ministers and officials at the earliest, to apprisethem of our view point.

Notes to the Editors:

About Indian Biscuits Manufacturers’ Association (IBMA)

IBMA is the largest association of biscuit manufacturers in India. IBMA was established in 2004 with a view to bring all biscuit manufacturers together to look at and work towards quality control and quality enhancement for the industry, encourage better managerial and resource practices and promote environment protection.

IBMA has always focused on small and medium enterprises engaged in biscuit manufacturing and ancillary businesses. IBMA serves as a platform for these companies to come together and share their insights and learning for increasing efficiencies in their manufacturing processes and for better resource planning. It also acts a specialized think tank to work around the current and futuristic problems and aspects of the industry. IBMA liaisons with similar associations and bodies in other countries, especially in developed countries, for knowledge sharing, data and publications.

Since its inception, IBMA has worked tirelessly to safeguard the interests of its members and of the biscuit industry as a whole. It has also made representations to the government from time to time in regards to genuine demands and problems of the industry.

The membership of IBMA has grown consistently since its inception and. It now has members from all corners of the country.

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आईबीएमए ने बिस्किट पर जीएसटी की दर 12% तक कम करने की मांग की है

  • बिस्किट पर 18% जीएसटी लागू होने के बाद से इस उद्योग में स्थिरता आ गई है।
  • बिस्किट कम लागत पर स्वच्छता, ऊर्जा, पोषण की तलाश करने वाले रिक्शा चालकों और कम पैसा पाने वाले मजदूरों द्वारा उपयोग किया जाने वाला आम उत्‍पाद है।
  • बिस्किट कृषि उत्पादों जैसे गेहूं, वनस्पति तेल, चीनी और दूध से बना है और बिस्किट के अधिक मात्रा में उत्पादन से बड़ी संख्या में किसानों को फायदा होता है।

नई दिल्‍ली, 16 जनवरी 2018: बिस्किट निर्माताओं, विशेष रूप से एसएमई क्षेत्र, इसमें 18% की दर पर गुड्स एंड सर्विसेज टैक्स (जीएसटी) के लागू होने के कारण मुश्किल के दौर से गुजर रहे हैं। यह उद्योग 18% जीएसटी लागू होने के बाद मंद पड़ गया है और इसे दोबारा सुचारु करने के लिए जीएसटी की दर को 12% तक कम करने की जरूरत है। बिस्किट एक बड़े पैमाने पर उपभोग किया जाने वाला खाद्य उत्पाद है, स्वच्छता से संसाधित बिस्किट के उपभोक्ता मुख्य रूप से गरीब वर्ग के लोग हैं, लेकिन बिस्कुट को एक प्रीमियम उत्पाद समझा गया है, जिसे समृद्ध समाज द्वारा उपभोग किया जाने वाला समझकर इसे उच्‍च कर प्रणाली में शामिल कर लिया गया है।

“बिस्किट कम लागत पर स्वच्छता, ऊर्जा, पोषण की तलाश करने वाले रिक्शा चालकों और कम पैसा पाने वाले मजदूरों द्वारा उपयोग किया जाने वाला आम उत्‍पाद है। इसी तरह के खाद्य उत्पादों जैसे कि मिठाईयां (5%), प्रसंस्कृत सूखे मेवे (5%), चाय (5%), जूस, नमकीन, जाम/जेली, नूडल्स, पास्ता, टमाटर केच-अप (सभी 12%) पर जीएसटी कम है। जबकि बिस्किट पर जीएसटी 18% लगाया गया है। हम सरकार को बिस्किट उद्योग पर 18% जीएसटी लागू करने के फैसले की दोबारा समीक्षा करने का आग्रह करते हैं। इस उद्योग के विकास में स्थिरता से बचने के लिए जीएसटी की दर को 12% तक लाने की आवश्यकता है।” भारतीय बिस्कुट मैन्युफैक्चरर्स एसोसिएशन (आईबीएमए) के अध्यक्ष श्री बी पी अग्रवाल ने ये बातें कहीं।     

क्रेमिका बिस्कुट के प्रबंध निदेशक श्री अनूप बेक्टर ने कहा कि “बिस्किट गेहूं, वनस्पति तेल, चीनी और दूध जैसे कृषि उत्पादों से बना है और बिस्कुट के उच्च उत्पादन से अधिक संख्या में किसानों को फायदा होता है। बिस्किट उद्योग में अत्यधिक श्रमिक जुटे हैं, और इसके उत्पादन में स्थिरता आने से इस उद्योग पर प्रतिकूल प्रभाव पड़ेगा जिससे अनुमान है कि लगभग 7.5 लाख कर्मचारियों को प्रत्यक्ष रूप से बेरोजगारी का खतरा और 30 लाख से अधिक व्यक्तियों जिसमें विपणन, खुदरा नेटवर्क, परिवहन आदि जुड़े हैं उनपर अप्रत्‍यक्ष रूप से असर होगा।

बॉन बिस्किट के सीईओ श्री पंकज अग्रवाल ने कहा, “बिस्किट उद्योग को परिवहन, ईंधन, पैकेजिंग, मजदूरी आदि की उच्च लागत के कारण इनपुट/सामग्री की कीमत में वृद्धि के अधीन किया जाता है।”

आईबीएमए ने पहले ही माननीय प्रधानमंत्री श्री नरेंद्र मोदी, केंद्रीय वित्त मंत्री श्री अरुण जेटली, केंद्रीय खाद्य प्रसंस्करण उद्योग मंत्री श्रीमती हरसिमरत कौर बादल और सभी राज्यों के वित्त मंत्रियों जो कि जीएसटी परिषद् के सदस्‍य हैं उनको विस्‍तृत व्‍यौरा पेश किया है। आईबीएमए ने संसद में मौजूद विभिन्‍न राजनीतिक दलों के सभी सदस्‍यों से इस उद्योग को जीएसटी के 12% के निचले स्लैब पर लाने के लिए समर्थन देने की मांग की है। बिस्किट पर जीएसटी की दर को कम करने से उत्पादन बढ़ेगा और यह केन्द्रीय और राज्य सरकारों के राजस्‍व को प्रभावित नहीं करेगा।” क्राउन बिस्किट के निदेशक श्री दीपक भरवानी ने ये बातें कहीं।

आईबीएमए ने मंत्रियों और अधिकारियों के साथ जल्द से जल्द बैठक करने का अनुरोध भी किया है, ताकि हमारे दृष्टिकोण का अनुमोदन जल्‍द से जल्‍द किया जा सके।

एडीटर्स के लिए नोट:

भारतीय मैनुफैक्‍चरर्स एसोसिएशन (आईबीएमए) के बारे में

आईबीएमए भारत में बिस्कुट निर्माताओं का सबसे बड़ा संगठन है। आईबीएमए को 2004 में स्थापित किया गया था ताकि सभी बिस्किट निर्माता एक साथ मिलकर उद्योग के लिए गुणवत्ता नियंत्रण और गुणवत्ता बढ़ाने की दिशा में काम कर सकें, साथ ही बेहतर प्रबंधकीय और संसाधन प्रथाओं को प्रोत्साहित करें और पर्यावरण संरक्षण को बढ़ावा दें।

आईबीएमए ने हमेशा बिस्कुट निर्माण और सहायक व्यवसायों में लगे छोटे और मध्यम उद्यमों पर ध्यान केंद्रित किया है। आईबीएमए इन कंपनियों के साथ मिलकर एक मंच के रूप में कार्य करता है और उनकी विनिर्माण प्रक्रियाओं में दक्षता बढ़ाने और बेहतर संसाधन नियोजन के लिए अपने विचारों को साझा करता है। यह उद्योग की वर्तमान और भविष्य की समस्याओं और पहलुओं के आसपास काम करने के लिए एक विशेष थिंक टैंक का भी कार्य करता है। अन्य देशों में विशेष रूप से विकसित देशों में जानकारी साझा करने, डेटा और प्रकाशन के लिए इसी तरह की संस्थाओं और निकायों के साथ आईबीएमए संबंध बनाता है।

इसकी स्थापना के बाद से, आईबीएमए पूरी तरह से अपने सदस्यों और बिस्किट उद्योग के हितों की रक्षा के लिए अथक प्रयास कर रहा है। इसने उद्योग की वास्तविक मांगों और समस्याओं के संबंध में समय-समय पर सरकार को भी प्रस्‍ताव दिया है।

आईबीएमए की सदस्यता इसकी स्थापना के बाद से लगातार बढ़ी है। अब इसमें देश के सभी कोनों से सदस्य जुड़े हैं।

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IBMA News Bulletein 2012 aug

Due to unprecedented increase in the costs of Major Raw materials during the   last two years, manufacturers of Biscuits across the country especially  those in the Small & Medium Sector, are  experiencing  acute hardships and resultant losses.The hike in Major Raw Materials/Inputs witnessed by Biscuit Manufacturers during the last two years

IBMA Thanks F. M For Hike In Exmption Limit To Rs. 100/ Per KG

New Delhi Friday, 4″1 May f)QT,fye Indian BiscuitManufacturers Association (IBMA) has wholeheartedly welcomed the announcement by Shri P Chidambaram. Finance Minister yesterday, extending exemption limit from Central Excise Duty on biscuits with MRP upto Rs. 100/kg, from Rs.50/kg, a^-per the Budget for 2007-08, presented before Parliament on 28 February 2007.
While briefing media today, Shri B P Agarwal, President of Indian Biscuit Manufacturers’ Association (IBMA) stated today that the present announcement is in recognition of the Post Budget memorandum submitted by IBMA inter alia pointing out the anomaly in the original budget proposal limiting excise exemption to only biscuits with MRP upto Rs.50/kg will benefit only very few large biscuit manufacturers as almost ninety percent of the biscuits with MRP upto Rs 50 is manufactured by such few large biscuit manufacturers.
Shri B P Agarwal, President, IBMA was confident that with the increase in exemption limit for biscuits with MRP upto Rs. 100/kg, more than 150 SMEs in the biscuit industry will now he able to have a level playing field.
The IBMA President thanked the Finance Minister for acceding to the Association’s plea that since the revenue outgo is very little as compared to the employment opportunities that are being created in the industry on an yearly basis, there is an economic rationale for extending the C’envat exemption to the biscuits exceeding Rs 50 per kg
Since most of the 150 SMEs are producing mixed varieties of biscuits, the increase in excise exemption for biscuits with MRP upto Rs. 100/kg would also remove their hardships for maintaining excise duty related documents, including differentiation in stock of raw materials/packing materials / transportation cost etc. separately for Excisable and non-excisable biscuits ultimately resulting in higher cost burden , as almost all categories of Biscuits would be covered under the newly announced excise exemption. For more information, please contact Mr K P Mohandas. Secretary General, IBM A(Mobile:9818857709)

Reduce VAT To 4% From The Steep 12.5%- Biscuit Industrys

New Delhi, Wednesday 9 May 2007 Imposition of Value Added Tax (VAT) at the highest rate of 12.5% on biscuit has hardly hit the sector especially the small and medium segment. Higher VAT is resulting in low demand pick-up and subsequent losses to the biscuit industry.
While addressing a Press Meet today in New Delhi. B P Agarwai. President. Indian Biscuits Manufacturers’ Association (IBMA) said that the Association has submitted representations to the Chief Ministers/Finance Ministers of all State Governments, as also to Mr Asim Dasgupta, Chairman, Empowered Committee on VAT, with the plea to reduce the rate of VAT on biscuits to 4%.
“Biscuit is a merit good and is a nutritious snack food hygienically processed & packaged. It is available at very reasonable prices and consumed predominantly by children as almost a staple food/breakfast. Economically weaker sections of the society consume biscuits The recent findings of National Sample Survey Organization (NSSO) lend credence to the fact the low income group’s demand for goods like milk, fruits and the food items of similar ilk are incree.°;ng more than the demand for cereals and grains.” says Mr Agarwai Fiscal policies should be accordingly tailored to ensure greater consumption of these goods among the low-income group, he added.
IBMA Chief added that, biscuit is a part of the food processing industry. recognized as a thrust area by the Government of India. Higher consumption of processed food including biscuits will lead to greater demand for agro products, !ihc v/hoat, vegetable oil, sugar rnilk etc. Thus, growth in production and consumption of biscuits would benefit the farmers of these agro products. However, sharp increase in the prices of wheat / Maida, vegetable oil sugar etc has already hiked up the cost of production. Biscuit is also subjected to various other local levies, such as Purchase Tax, Entry Tax / Octroi etc. There are taxes/duties / cess etc on ingredients of biscuit, packaging material, equipment etc.
While appreciating the-increase in the threshold limit for Excise Duty exemption for biscuit from MRP upto Rs.50/- to Rs.100/ kg, announced by the Finance Minister on 3 May 2007, Mr Agarwal said that IBMA has strongly pitched for reviewing the Budget proposal since the earlier proposal was to restrict excise exemption for biscuit upto MRP of Rs.50/- per kg. This would have benefited only one or two large industrial houses, to the detriment of more than 140 Small & Medium enterprises in the biscuit industry.
Mr B P Agarwal mentioned that, recognizing the need to encourage biscuit manufacturing, the State of Tamil Nadu, which has recently introduced VAT, has fixed rate of 4% on biscuits. Similarly Assam is also levying VAT @ 4% on Biscuits. Other State Governments should also favorably consider IBMA’s representation for fixing 4% VAT on biscuit
According to the IBMA President, similar food products like Wafers, Bhujia, Namkeen, Bread, Fruit Juice, Jam, Jelly, Potato chips, Ice Cream etc are either exempt/or levied VAT at 4%. Even a luxury item like dry fruits is exempt/or at 4%, from VAT. However, biscuit – common man’s snack food, hygienically made & packaged available reasonable prices- is subjected to VAT at 12.5%
Mr Agarwal informed media that biscuit manufacturing is highly employment oriented and mainly consist of SMEs. Biscuit industry in the country, directly and indirectly employs more than 25 lakhs workers, and therefore, deserves sympathetic consideration by the State Governments, especially with regard to levy of Value Added Tax at the minimum rate of 4%.
Biscuit, which is high volume agri-based product, operating under highly competitive environment with the characteristic very thin margin of profit, predominantly in the SME sector is subject to highest level of taxation, making the survival of the firms highly difficult.
“In our communications and oral submissions before Chairman and Member Secretary of the Empowered Committee and also to the State Finance Ministers, we have apprised them about the pernicious effect of the higher VAT on biscuits. Some of the State Governments have already acted on it. We hope that the Empowered Committee on VAT will favorably decide our case salvaging the labor intensive biscuit industry.” says Mr Agarwal.
For further information, please contact Mr.K.P.Mohandas, Secretary General, IBMA (Mobile No. 9818857709) or Mr.Joseph Thachil, Media Advisor (Mobile No. 9810516770).

Subodh Kant Sahay promise help to Biscuit Industry to achieve higher quality

Inaugurating a Seminar on Food laws – Problems and Prospects, organized by Indian Biscuits Manufacturers’ Association (IBMA) today, Shri Subodh Kant Sahay, Minister of State for Food Processing Industries, Govt of India, stated that his Ministry will provide adequate financial assistance to food processing industry for achieving higher quality of food products like biscuits and also for building a network of 100 Quality Testing Lab rotaries throughout the country.

Lauding the role of food industries who provides food for the economically weaker segments of the society at comparatively cheaper prices, Shn Sahay said that it has been the endeavour oft he Food Processing Ministry to encourage growth of food industries, especially in the Small & Medium Sector.

Earlier, welcoming the Minister, Shn B P Agarwal, President of the Indian Biscuits Manufacturers’ Association (IBMA) that the main objective of the Seminar is to afford an opportunity to various segments of food processing industries, including biscuits manufacturers, especially in the small & medium Sector, to deliberate on various issues affecting food industry, arising out of the recent amendments in

PFA Rules, Packaged Commodities Rules ets, as also die newly x.
enacted integrated Food Safety & Standard Act, 200? and find
solutions to the grey areas in the Food Laws.
The Seminar also aims to create a unique platform for decision- maker in the government and all stakeholders in Ihe food processing industry as also consumers.
hn Agarawal said ihat Government and more particularly the Ministry of food processing Industries under the dynamic leadership of Shri Suboth. Kant Sahay has to be credited for the creation, of the integrated Food Safety and Standards Act 2006. This has taken care of everybody’s long standing demand for consolidating the multiple legislations enforced on the Food Industry, leading to hardships bolh to tiie industry and the enforcing Departments due to overlapping of various regulations.
For favour of publication/ coverage please

IBMA News Bulletein 2009 May-July

BMA has been on the forefront in vigorously pursuing Biscuit Industry’s request for reducing VAT from 12.5% to 4%. To further highlight acute hardships and heavy losses being suffered by biscuit manufacturers especially those in the SME sector, our Association has again taken initiative and submitted detailed representations to Shri Asim Dasgupta, Chairman and Satish Chandra, Member Secretary, Empowered Committee on VAT and similar representations have also been submitted to the Chief Ministers and Finance/ Excise and Taxes Ministers and to the concerned officials of all State Governments. The adverse impact of high rate of VAT along with rising cost of production/ prices of major raw material/ inputs etc have been highlighted.

 To follow up and voice Biscuit Industry’s view points on VAT, IBMA Delegations propose to meet the Ministers, officials in various States.

 Members in different States are once again requested to assist us in obtaining such follow up meetings, so as to seek VAT  @ 4% on Biscuits, especially in the context of the proposed introduction of Goods & Services Tax(GST) merging VAT and other local taxes, with effect from 1st  April 2010, since reduction on VAT to 4% will result in lower rate of GST on Biscuits.