No GST on packaged food products if rights foregone on brand
Dated NEW DELHI, September 21, 2017
Packaged food products will not face goods and services tax at the rate of 5% if the manufacturer declares to voluntarily forego any actionable claim or enforceable right on the brand name.
"5% GST will, however, not apply if the person concerned voluntarily foregoes any actionable claim or enforceable right on such brand name, subject to the conditions," a finance ministry statement said on Wednesday. The entity will have to file an affidavit to the effect that it is voluntarily foregoing actionable claim or enforceable right on such brand name with the jurisdictional Commissioner of Central Tax or State Tax, or the jurisdictional officer of Union Territory Tax, it said.
The provision also mandates that the entity print in indelible ink, both in English and local language on each such unit container, that in respect of brand name printed on the unit containers it has voluntarily foregone actionable claim or enforceable right, the statement said.
Packaged cereals, pulses and flour bearing a registered brand name attract 5% GST while those sans that are exempted.
The GST Council had on September 9 decided to tighten the framework governing these products following reports of abuse of norms by companies. These norms would be notified on September 22, the release said.
A brand registered as on May 15, 2017 is deemed to be a registered brand for the purposes of levy of 5% GST, irrespective of whether such brand is subsequently deregistered, according to the latest guideline.
A brand registered as on May 15,2017 under the Copyright Act, 1957 shall also be treated as a registered brand for the purposes of levy of 5% GST, while that registered on the cut off date under any law for the time being in force in any other country shall also be deemed to be a registered brand for the purposes of levy of 5% GST.
A mark or name in respect of which actionable claim is available shall be deemed to be a registered brand name for the purposes of levy of 5% GST.