Glucose biscuits set to go lighter, all thanks to GST

July onwards, you might feel that the typical glucose biscuit that you relish with your cup of tea has gone lighter; and you’d have nothing but goods and services tax (GST) to blame for that.

Earlier, glucose biscuits used to be taxed differently than the cream or oat biscuits, but GST has mandated them all to be taxed similarly. This has forced the biscuit manufacturers to cut corners, so that the customers don’t bear the burden of increased costs.

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"This category is absolutely price sensitive... we won't be able to pass on any increase in cost to consumers," Haresh Doshi, president of Biscuit Manufacturers Welfare Association, told ET.

Meanwhile, the association has filed a petition with the Goods and Services Tax Council, requesting it to keep biscuits that cost less than Rs 100 a kg in the zero-tax bracket.

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As of now, low-priced biscuits are exempted from central excise but have to pay VAT in states.

"Dry fruit cookies and oatmeal cannot be taxed on a par with low-priced biscuits," Doshi said.

He added that even though there has been a surge in the input costs, prices in this segment have never gone up substantially. While glucose biscuits retailed at Rs 40 per kg in 1996, they sell at Rs 70 per kg twenty years later.

(Image source: ThatScoop)