GST inflates prices of bakery items

Neha Basudkar
Friday, 12 January 2018

The Bakers’ Association of India submitted a memorandum to Finance Minister Arun Jaitley on January 10 with a demand to cut GST rates from 18 per cent to five per cent on bakery goods as this is the food for commoners and not luxury product, otherwise, the bakery industry will be in danger. The GST meeting is scheduled to take place on January 18

Pune: People who are buying cakes to celebrate birthdays are feeling a pinch as there is a sudden hike in prices of bakery products since a month due to GST.

The Bakers’ Association of India submitted a memorandum to Finance Minister Arun Jaitley on January 10 with a demand to cut GST rates from 18 per cent to five per cent on bakery goods as this is the food for commoners and not luxury product, otherwise, the bakery industry will be in danger. The GST meeting is scheduled to take place on January 18.

According to Ramesh Mago, Patron of All India Bakers’ Association, there are two lakh bakers spread across India which consists of organised and unorganised bakers. Mago said, “There are two categories in bakery industry i.e. organised and unorganised. The bakers who have their chains established across the city or in the city are categorised into organised while the bakers only with one bakery shop in the city are categorised into unorganised.”

“After implementing GST in July, the government had revised the prices of many products. But it did not revise the prices of bakery products. So we had to call up a meeting of bakers in November last year. Around 100 bakers attended the meeting and all were of the same opinion that the GST rates should be reduced,” Mago added

The bakers of the city are pricing bakery products according to their wish. Bhushan Giramkar, owner of New Poona Bakery, said, “As we were hoping that the prices will revise, even after implementation of GST on bakery products, we had not hiked the prices. But now the scenario is it will take time to revise the price list, so we had to hike the prices and the bakery owners are randomly deciding the prices at which the bakery products will be sold and the demand will also not go down.”

Nasir Ahmed of Golden Bakery said, “GST should be levied on such companies where there is huge turnover. Our turnover is in lakhs. Also, we do not have any chains to expand our business. Our only demand is that bakery products such as khari, cream roll, cookies, pastry, cakes, toast etc are all commoners’ food and should not be considered as luxury products.”

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