Reportedly one day after a tribunal court’s decision to uphold 18 per cent GST on south indian bread parotas and the trend #HandsOffMyParotta rocked the Internet, the government was forced to step in with an explainer. The government sources told india Today tv that the decision was taken by the karnataka bench of Authority of Advance Ruling (AAR).The AAR (Karnataka) bench held that frozen (and preserved) wheat parota and malabar parota, with a shelf life of three-seven days, was a "distinct product and not a plain roti". It has held that frozen and preserved parota would attract GST at the rate of 18 per cent.
Furthermore sources in the government tried to cool the debate after the AAR said that all indian breads cannot be categorised as rotis (a generic name for indian flatbread) and the ready-to-eat parotas, that need to be heated before consumption, would be subjected to higher tax level of 18 per cent GST. The government explained saying that the frozen parota, which is preserved, sealed, branded and is usually sold at higher prices cannot be considered as a staple food for poor, consumed on a regular basis. It is rather consumed by a class that could afford to pay taxes, the sources said.
Sources also said that levying higher tax rates was a standard worldwide practice where processed or packaged food are taxed at a higher rate.Sources said, "The rate of frozen and preserved parota was earlier discussed in the GST Council meeting. The council did not recommend the reduction of GST rate on the frozen and preserved parota as these parota are sold by the organised sector."Since the ruling had led to a widespread fear that all the parota or malabar parota may start costing more, the government clarified that those eating out in restaurants or the "tiffin centres" will not be impacted as fresh flatbread or rotis or any parota, served for consumption by a restaurant, or takeaways will continue to attract 5 per cent GST rate just like the plain roti.
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