At the GST Council meeting held on Saturday, Delhi Deputy Chief Minister Shri Manish Sisodia sought removal of the discrepancy in deciding taxes for ‘Papad’ and ‘Kachri’. He also wrote a letter to Union Finance Minister Smt. Nirmala Sitharaman in this regard.
Shri Manish Sisodia said that because of a clarification circular issued from the Union Finance Ministry on January 13th, 18% GST is now being levied on Papad as well as Papad-like products, which are commonly known as Kachri or ‘Kachri Papad’. Papad and Kachri belong to the same food category. In such a scenario, 0% GST on Papad and 18% GST on Kachri is unjustified. He further added that Kachri Papad is not a premium product and if the discrepancy is not removed, this will encourage the practice of generating wrong bills and will increase tax evasion.
The Delhi Dy CM in his letter to the Union Finance Minister said that both Papad and Kachri Papad products are basically made in India. Before the GST was implemented, most of the states levied 0% tax on these products. Even after the implementation of the GST, 0% GST was levied on Papad and Kachri Papad. However, a circular from the Union Finance Ministry on January 13th has resulted in a discrepancy. Papad and Kachri belong to the same food category and also, they are prepared from similar raw materials. But by mistake, these products have been put in the category of snacks palette and 18% GST has been levied on them.
Shri Manish Sisodia said that the central government has used the word ‘fryums’ in the circular despite the fact that there is no category named as fryums. It is a popular band that has a varied range of products. In such a situation it is wrong to keep Kachri Papad in the category of fryums. He added that Kachri Papad is a common product. If we look at the rate chart of GST, we can see that 5% GST is applicable on vermicelli, 5% GST on Pizza bread. There is 5% GST on sago. Cereal Pellet has 5% GST. Potato Pellet has 5% GST. Pasta has 12% GST. Salted cashews and almonds also attract 12% GST. Normal snacks also attract 12% GST. But Kachari Papad, which is a product exactly like Papad, has been kept in the GST category of 18%.
He said that this is an anomaly and it should be eliminated as soon as possible. The discrepancy created by the clarification circular has left both the traders and customers confused. There is 0% tax on Papad but an 18% GST is being charged on Kachri Papad. In such a situation, if this discrepancy is not eliminated, it can encourage the tendency of generating wrong bills and tax evasion.
In the meeting of ‘Mahasabha Parishad’ today, Shri Manish Sisodia sought the clarification to remove the anomalies arising due to the circular and said that if the Council consents, Kachri Papad will be classified in 0% subscription category. The above can also be kept in the attic range of 5%. But this distinction needs to be removed immediately.