Kollam: The cashew industry has welcomed the GST regime as it anticipates more inflow of raw cashew which will provide jobs to the workers in the sector. The present 12 percent tax has been reduced to five percent which will also dodge the special additional duty (SAD) that will be replaced by GST on imports. However, earlier there was tax exemption for cashew transferred to own inter-state firm of the same company, but under the GST each transfer would be considered as sales.
The GST council has fixed the GST of raw cashew, cashew nut and allied products in the five percent slab. Earlier, it had fixed the GST for cashew at 12 percent clubbing it along with other tree nuts. This anomaly was pointed out by the Federation of Indian Cashew Industry (FICI) and other associations, including the Cashew Export promotion Council of India (CEPCI). They had demanded placing it under the five percent slab.
“Prior to the GST, only the traders could claim back four percent SAD of the total 9.36 percent tax, but not the processors. The only disadvantage is that if we purchase cashew from local traders we should give tax and claim it while exporting,” Dr. R.K. Bhoodes, Cashew Export Promotion Council of India (CEPCI) vice-chairman, told DC
For the import of cashew processing machinery, the fixed 20 percent duty should be paid in advance, against an earlier system of signing the commitment to export cashew worth six times the amount of relaxation given. Earlier, it was claim in advance, and now it is pay in advance which should be claimed later. Similar is the case of importing raw cashew. It apparently increases the working capital of the processors.
