Food Processing Ministry for 0% vat on perishable food items

Kolkata, May 23 (UNI) The Centre was considering to impose zero per cent VAT on perishable foods and would not hike its ceiling beyond 4% in case of other perishable items and is likely to grant food processing industry status to packaging industry, according to Minister of State for Food Processing Subodh Kant Sahai here today.

Inaugurating the conference on ''Linking Farmers to Markets: The Food Processing Way,'' organised by ASSOCHAM, Mr Sahai also announced that his Ministry was not opposed to large FDIs entry in Indian and support them in case they follow 'Indian model' to expand their activities.

The Minister, however, agreed with ASSOCHAM Agriculture&Food Processing Committee Chairman Pradeep Wig that the government should announce tax holidays coupled with moderate state levies for promotion of food processing units throughout the country in consultation with state governments.

Mr Sahai said in the coming National Development Council (NDC) meeting, scheduled for May 29 in New Delhi under the chairmanship of Prime Minister Manmohan Singh, agriculture and food processing would figure in the agenda.

'' NDC is exclusively devoted to suggest ways for betterment of India's agriculture and its food processing industries, '' he said.

The Minister said that on perishable food items, zero per cent VAT should be applicable and on other perishable items, the ceiling would not exceed beyond four per cent and the Food Processing Ministry would take up this with the Empowered Committee of State Finance Ministers on VAT.

Mr Sahai also said food processing was an area through which the lot of farmers could move for better and suggested that they should form cooperatives and then sell their produce for higher margins.

The government in its future legislation would try its best to minimise, if not eliminate, the role of middlemen for sell of their produce, he said.

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