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5% GST on unbranded, pre-packed food items to hit Small Traders

Published on July 05, 2022
Current Context: Recent decision of the GST council about a 5% imposition of tax on pre-packed and unbranded food items would hit small businesses across the country as per Confederation of All India Traders (CAIT).
5% GST on unbranded, pre-packed food items to hit Small Traders
  • GST Council’s decision will cause huge business losses for food cereal traders across the country.
  • Besides, It will allow big brands to capture the market at the expense of small producers and traders.
  • For the first time, large-scale branded goods were brought under the tax network earlier in 2017.
  • Apart from that, GST Council brought packaged foods such as milk, curd, dried legumes, Mahana, wheat or meslin flour, jaggery, puffed rice, organic food, manure, and compost under the 5% tax rate.
  • This government decision will increase the burden of compliance and its costs for traders.

Question:

Q.1 A Recent decision of GST about 5% tax will majorly impact which of the following sectors?
a. Large scale Traders
b. Intermediate Traders
c. Small Traders
d. None of the above
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