GST created hiccups, DeMo disrupted wholesale channels: ITC

Kolkata, Jul 28 () Diversified conglomerate ITC Limited today said that while demonetisation had "disrupted" the wholesale trade channels, implementation of GST had created some hiccups in transition, but becoming better every week. "There had been some hiccups after the implementation of GST, but is becoming better every week. The wholesale channel is taking time while the retail channel is less affected. But disruptions are far less lower than expected", CEO of ITC Sanjiv Puri told reporters after the company's AGM here. Puri said that while GST was supposed to be revenueneutral, the dual tax rates on certain FMCG categories likeatta had created some anomalies."Taxation rates on unbranded and branded product categories like atta had led to creation of anomalies. There should have been a standard rate to promote the processed food industry which could have created more jobs". he said. Asked to comment on impact of different GST rates onthe entire FMCG portfolio of ITC, Puri said "the impact hadbeen more or less even. While taxes on soaps are low, it ishigh on shampoos".On the whole, Puri said ITC's overall FMCG portfoliohad seen robust growth and grew faster than the industry.ITC was building on segments in the FMCG space wherenot present now.Chairman of ITC Y C Deveshwar said "anomalies are there and not economically ideal". The purpose of GST was not have multiple rates, addingthat eventually it would become a single rat, he said."Our target is to reach a turnover of Rs one lakhcrore by 2030. We will be looking towards to enter at allpossible FMCG categories", Deveshwar said.Expressing concern over the taxation on cigarettes,Puri said "It is a major cause for worry".There had been 202 per cent rise in tax which had ledto smuggling of cigarettes and shift towards other forms oftobacco consumption.Puri said that after the excise imposition in thebudget, there had been successive bouts of taxation on thelegal cigarette industry which comprise 11 per cent of totalcigarette consumption."68 per cent of cigarette sold escape regulatoryoversight", he said."With increase in taxation, the legal cigaretteindustry is being put under pressure", he said. dcRG