The sweetmeat shop owners in West Bengal have threatened to go on strike if the sector is not exempted from GST. Sweetmeat was not taxed under VAT but from July 1, they will be charged at 5 per cent.

According to RK Paul, General Secretary, Paschimbanga Mistanna Byabsayee Samity, at least 80 per cent sweetmeat business is in informal sector. Primary raw materials such as chenna are also produced by informal sector.

“GST will push majority of the sweetmeat producers and their vendors out of business,” Paul said at a press conference on Monday. This is over and above the across-the-board rise in prices, which he estimates to be seven to eight per cent.

According to him, there are roughly 150,000 sweetmeat shops, mostly neighbourhood shops, providing direct employment to 750,000. The industry turnover is estimated at ₹50,000 crore.

Sourcing Informally

According to Paul, sweetmeat shops procure most ingredients without formal cash memos or challans or receipts. (Tax is paid on some items like plastic containers.) Naturally availing input tax credit is difficult.

“Majority of our suppliers will remain outside GST net and cannot provide us with requisite documents. So the entire tax burden falls on us or the end consumer. Small shop owners will be particularly hit as they cannot increase sweetmeat prices overnight,” Paul explained.

Wastage

Incidentally, unlike the rest of the country, Bengali sweetmeat is chena based, ensuring low shelf life and high wastages. According to Paul this essentially makes Bengali sweetmeat relatively costlier.

“Shelf-life of traditional Bengali sweets is not more than 24 hours. Compared to elsewhere where offerings have a higher sugar content, the shelf-life can be up to a few weeks. Hence, taxing such highly perishable offerings will adversely affect sales,” he pointed out.

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