Since the government introduced its highly ambitious Goods and Services Tax (GST) on July 1, the 'one nation one tax' is still the most talked about topics among traders and businessmen. But along with the usual discussions of its pros and cons, they are also lamenting how confusing it is.
And among all the confused traders, it is the sweet shops who are finding it particularly difficult to decide the pricing of their various items, reports The Times of India. The prices of various sweets and savouries will now have to be changed as per their respective ingredients.
This is how confusing it really is...
ScoopWhoop News checked with some sweet shops in Delhi to confirm the confusion. Traders told us that while earlier, all sweets were put under a category of 5 percent tax, they will now have varying prices. For instance, a plain barfi attracts a 5 percent GST. But if it has dry fruits, it will come under 12 percent slab. That's not all, barfis having chocolate will be taxed 28 percent.
Similarly, assorted gift packets of sweets will be charged based on the item which has the highest GST. For instance, a gift pack which has only one chocolate item will be wholly charged 28 percent.
Owing to the confusion around the new GST tax slab, many shopkeepers haven't changed their prices. "There is no clarity on anything which is why we haven't changed our prices yet. We don't know how to fix the prices of sweets as it has to be changed as per the ingredients," Satish Aggarwal who owns Delhi's prominent Bengali Sweet House told ScoopWhoop News.
"Will barfis which have dry fruits just for decoration purpose attract 12 percent GST? If so, then what about almond barfi which is fully made of dry fruits? These are some questions which no one seems to have any answer," he asked.
Apart from the ingredients, sweet shops are also confused about the pricing if sweets are served at their restaurants as it attracts 18 percent tax. "If you buy besan laddu, 5 percent GST will be charged. But if you eat it at our restaurant, you will be taxed 18 percent. All this is confusing," he said.
Aggarwal said that it will take him some time to revamp the entire pricing structure. "It is 'wait and watch' for us as of now," he said.
The new tax rules have also affected namkeens (savouries). Samosas, bread pakoras, kachoris etc will now attract a tax of 12 percent. Last month, the Snack Food Association of Maharashtra (SFAM) had urged the government to reduce it to 5 percent to maintain uniformity with GST rate for sweet meats & mithai, reports PTI.
The confusion is across India. For instance, a report in Hindustan Times talked about how sweet shops in West Bengal - about one lakh in number! - are equally confused with the implementation of GST.
Balaram and Radharam Mullick Sweets, a popular sweet shop in Kolkata introduced the new pricing right from the day one of its implementation. "We didn't increase the price of our products. We just added the respective tax rates," Sudip Mullick told ScoopWhoop News.
But he questioned the complex tax slabs for food items. "Why are there so many tax rates for the food items? Can't they just put all the sweets under one slab," he asked.
He also expressed his concern whether small sweet shops will be able to deal with the situation. "Unlike other states, Bengal has the largest number of sweet shops in the country. There are lakhs of people who are directly dependent. Big shops like us can manage but how do you expect these small shops to come up with computers with accounting software as well as accountants," he asked.