A think tank has requested the GST Council to levy a higher tax of 18 per cent on tetra pack, arguing that the product is incorrectly categorised in the 12 per cent slab as a paper-based aseptic packaging.
Pandit Deendayal Upadhyay Smriti Manch (PDUSM) pointed out that other aseptic packaging containing plastic or aluminium or multi-materials like tetra-pack attract an 18 per cent GST rate.
Due to its cardboard-ish appearance, tetra-pack (HSN-4811), a multi-layer packaging (plastic+paper+aluminum) was inaccurately viewed as a paper-based aseptic packaging during the GST structuring in 2017, the Delhi and Mumbai-based think tank claimed.
The think tank has appealed to the GST Council, Central Board of Indirect Taxes and Customs (CBIC) and the Finance Ministry to amend the GST slab of tetra pack from 12 per cent to 18 per cent. A release by PDUSM claimed that tetra pack is also a key source of waste pollution in India.
Loss of revenue
According to the data collected by TERI, tetra pack recycling rate in India remained around 30 per cent over the last four years. Approximately 3,000 crore tetra packs have been dumped/littered since 2017, leaching various plastic, aluminum and paper based toxins in soil and water bodies.
The think tank claimed that due to the wrong taxation, around ₹948 crore of tax revenue has been lost since 2017.