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  • Cashew industry resents GST rate hike

    May 25th, 2017

    The cashew industry, which is already facing the brunt of imposition of import duty of 9.36%, has expressed its resentment over the rate of GST to be levied on processing units. India on an average produces around six to seven lakh tonne cashew nuts with an installed capacity of 10 lakh tonnes. It exports 1.3 lakh tonnes. The country is the largest cashew consumer and the second largest cashew processor after Vietnam. “The recent announcement of GST rate will affect cashew business imposing a huge burden on the consumers,” said Madhav Sure, finance and market head of Arle Cashew Pvt. Ltd.

    Mr. Sure told The Hindu that the existing sales tax rate on raw cashew nuts, cashew kernels, flavour cashew was 5%, which had been increased to 12% on raw cashew nuts and cashew kernels and 18% on flavoured (roasted etc.) cashew. Industry sources said GST would be helpful in cases where various indirect taxes like excise, import, octroi and service tax were being levied. However, in the case of goods where only sales tax is being levied, it would only push up their prices.

    Direct employment

    Cashew industry provides direct employment to around 10 lakh people, mostly rural women, and indirectly to around 3 lakh people throughout the country. In Andhra Pradesh, there are about 1,400 processing units, including small, medium and large scale enterprises which provide direct employment to around three lakh people from rural areas. “The new GST rate will deal a big blow to farmers, processors, dealers and end consumers, and importantly to workforce from the rural areas,” the owner of a processing unit said.


    Source: http://www.thehindu.com