may have fallen short of growth expectations in the
past, but there's no denying that the FMCG sector is
on the fast track. CNBC-TV18 reports that the budget
could just take this growth story forward.
hardly the sort of thing that crosses your mind when
you're stocking up on home supplies. But 35 per cent
of the price of a consumer product today includes just
indirect taxes, a figure which is the highest in Asia.
And that's probably why last year, the finance minister
proposed to introduce an integrated Goods and Service
Tax by April 2010.
my mind, this is an excellent move. It will add one
or two percentage points to India's GDP growth once
we have such a tax," comments Adi Godrej, chairman,
you can reduce the prices through this indirect tax
relief, through a national GST, there will be a tremendous
virtuous circle of consumption increase, production
increase, employment increase and tax increase,"
says Bharat Patel, Chairman, P&G India.
year, the industry hopes the finance minister will appoint
an empowered committee to get the GST rolling. Another
priority on the wish list is to exempt sales promotion
schemes from the ambit of fringe benefit tax - something
companies argue just cannot be treated as employee benefits.
year, the FM waived off excise duty on pastas, condensed
milk, ice creams and even meat and poultry products.
This time around biscuit companies are hoping to see
a mass market product, what we've got to do is level
the playing field and make sure this industry is not
inordinately taxed, as compared to other product categories
it competes with, whether it is namkeens (savouries),
fruit juices or salty snacks," says Vinita Bali,
important for FMCG companies is more consumers. So everyone
is hoping for a reduction in direct income taxes. More
the disposable income - more money to spend.