Kerala will not subject small shops, Kudumbashree shops to 5% GST imposition

20 Jul 2022 , 12:38 PM

The Kerala government on Tuesday stated it did not intend to charge goods sold by organizations like Kudumbashree, or tiny retailers in 1 or 2kg packages, in the midst of mounting protests over the application of Goods and Services Tax (GST) on necessities.

K N Balagopal, the state's finance minister, told the Kerala Assembly that while the choice would cause problems with the federal government, the state was unwilling to make concessions.

"In any case, Kerala does not plan to tax goods that are sold in 1 or 2-kilogram packages or in loose amounts by nonprofit organizations like Kudumbashree or in tiny shops. Even if this causes problems with the Center, "Balagopal informed the gathering. "On this, we are not prepared to give in. There, we had previously said this."

He said that the state administration had previously communicated its position to the Centre in writing. "The CM wrote to them about these issues yesterday as well. We won't be imposing it on independent retailers and small-time traders. There is no disputing this, "Balgopal tacked on.

One of the biggest women's empowerment initiatives in the nation is Kudumbashree, a women's self-help organization run by the Kerala government. It is involved in a number of businesses, including the operation of minor food manufacturing facilities.

According to Balagopal, branded businesses must pay a 5% tax on packaged goods, but this tax is waived if the packaging clearly states that the company is not "claiming the brand."

There is still some doubt about this, he continued, "therefore they (the center) have brought in the regulation to capture such firms.

Pinarayi Vijayan, the chief minister of Kerala, has asked Prime Minister Narendra Modi for prompt action on the matter of the application of GST on necessities, stating that doing so will have a negative impact on the general public.

Vijayan drew attention to the fact that a lot of small shops and millers pre-pack and have the things available for purchase so that consumers may take them right off the shelf without having to wait while the items are weighed and packaged.

Vijayan said in the letter that such pre-packing is a normal practise in the majority of Keralan retail stores and that the current shift will negatively affect the many regular consumers who frequently visit these stores for their necessary purchases.