Tax heat prices premium biscuit brands out of market
Vishal Sharma
New Delhi/ Agra. With biscuit manufacturers indicating a 15 per cent hike in the prices of the Glucose and Marie brands from May this year, due to heavy taxes in UP as well as the rest of the country, both the brands are fast disappearing from the local market, with retailers blaming distributors for holding up stocks.
Over 60,000 tonnes of biscuits are consumed in Uttar Pradesh annually.
In the Agra market, large family packs of both Marie and Glucose have become hard to find, an indicator of the impending crisis. Market sources say the distributors had reduced the supply after the Biscuit Manufacturers Association indicated that the biscuits might see a huge price hike in the coming month.
This was so because the prices of inputs like wheat, sugar and edible oil had risen over the past decade. Besides, high tax rates were also forcing this price hike.
According to industry sources, there is 8 per cent excise duty plus 12 per cent VAT for biscuit manufacturers while food-grade products like bread, cheese, and potato chips had been kept clear of VAT. The association wants VAT on biscuits revoked; otherwise; prices will be up by at least 15 per cent from May this year.
A delegation of biscuit manufacturers will meet the UP chief minister this week on this. Notably, though UP has not yet agreed on implementing VAT, there is an 8 per cent trade tax on biscuit sales in UP, which made them more expensive in the state than the neighbouring Delhi.
Over 60,000 tonnes of biscuits are consumed in Uttar Pradesh annually.
In the Agra market, large family packs of both Marie and Glucose have become hard to find, an indicator of the impending crisis. Market sources say the distributors had reduced the supply after the Biscuit Manufacturers Association indicated that the biscuits might see a huge price hike in the coming month.
This was so because the prices of inputs like wheat, sugar and edible oil had risen over the past decade. Besides, high tax rates were also forcing this price hike.
According to industry sources, there is 8 per cent excise duty plus 12 per cent VAT for biscuit manufacturers while food-grade products like bread, cheese, and potato chips had been kept clear of VAT. The association wants VAT on biscuits revoked; otherwise; prices will be up by at least 15 per cent from May this year.
A delegation of biscuit manufacturers will meet the UP chief minister this week on this. Notably, though UP has not yet agreed on implementing VAT, there is an 8 per cent trade tax on biscuit sales in UP, which made them more expensive in the state than the neighbouring Delhi.
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