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GST Bill And The Food Sector


With the GST in place, we will have a one tax system without the stream of multiple taxes at each point. This is a system that will bring efficiency in product costs. This is a healthy practice being followed by many nations across the world. GST is being called the most important tax reform India has ever seen. From international experience, it has been observed that inflation sees an upper trend initially once the GST is implemented.

How will the GST affect the food sector? With the GST in place and prices of commodities in check, we will have more transparency in the system. Sectors and eventually the common man will be relieved of the burden of paying multiple taxes at each stage.


Experts claim that the food prices will increase initially but the GST will bring in a set structure and ease of doing business. Trading in oilseeds, pulses and cereals, which till now have been happening outside the tax structure will be put into a structured regime. This comes as a breather to the consumer. It is likely that the commodities will now reach the farthest places of the country and this is a benefit to both the consumer who will now have access to good quality products and the producer who will be able to sell his products to a wider section of the consumers. The applicable GST on FMCG and processed foods in the future is said to be lower than the combined tax on those products.

Let’s hope that the overall GST on the food sector will be low as the sudden hike in prices of foods may burn holes in the pockets of the consumers and not take off certain processed foods out of the common man’s reach. The food industry will see a slow and a long expected growth.