Specials

Shocked by the retrograde budget proposal, says Indian Beverage Association

http://www.indiantelevision.com/sites/default/files/styles/smartcrop_800x800/public/images/event-coverage/2014/07/10/drinks_budget.jpg?itok=ktDypuAz

MUMBAI: Taking a cue from Health Minister Dr Harsh Vardhan, who has been pushing for higher tax on tobacco products, the Finance Minister Arun Jaitley took a step further from not only increasing excise duty on tobacco, but targeted the aerated drinks as well.

With an eye oncreating a healthier India, the FM has taxed aerated drinks containing sugar, while exempting fruit juices and other aerated drinks like soda.

"I also propose to levy an additional excise duty at 5 per cent on aerated waters containing added sugar. These are healthy measures and I hope everyone would welcome them from the point of view of human and fiscal health," Jaitley said in his speech.

However, the move hasn?t gone down well with the industry.

On the hike,  an Indian Beverage Association (IBA) spokesperson says, ?We are extremely shocked by the retrograde budget proposal of a 5 per cent hike in excise duty on aerated drinks with added sugar.?

The players point out that the soft drinks industry is already one of the highest taxed categories in the country. The combined impact of CENVAT and state VAT rates reaches 34 per cent in eight states in the country. ?Coming on top of the current 12 per cent rate, the additional 5 per cent duty increase will be tantamount to a 40 per cent increase in the central excise duty which would hit the industry hard and cause a major slowdown at a time when demand growth for the industry has been sluggish,? elaborates the spokesperson.  

The IBA rebuts the increase by saying that the carbonated soft drinks (CSD)  industry is a key segment of the food processing sector in India. It is a significant user of agri products and, with its high labour intensity, contributes significantly to agricultural growth and employment. With a ratio of direct to indirect employment of 1:4, similar to that of the software industry, the industry?s developmental impact is not adequately appreciated. Currently, it employs over 300,000 people, and if there is a conducive environment for growth the industry has the potential to grow at double digit rates and can contribute more than a million additional jobs over the next decade.  

?It must also be understood that in a country where options of safe, convenient and hygienic beverages are rather limited, CSDs play a very important role in meeting the hydration needs of people. With this hike in excise duty, the industry will have no option but to increase the price of its products. An increase in price will also fuel the growth of beverage options from the spurious and unorganised sector which, on the one hand, pose significant risk to public health and on the other, will take away tax revenue from the government,? adds the spokesperson.

Parle Agro CMO and JMD Nadia Chauhan says, ?In the wake of current hike, we will be evaluating our cost efficiencies for Cafe Cuba, whilst closely observing the change in dynamics of the CSD market. Our immediate focus is to work out a strategic approach that works best in serving consumer interest as well as maintaining the organisation?s operational cost. Whether we will be adjusting our price points, reworking volumes or fine-tuning marketing expenses is a key decision that will be taken basis analysis of all the key factors that determine our pricing strategy.?

As per a report by Euromonitor International, soft drinks off-trade value sales continued to record further growth in 2013 in India. The year also recorded many new launches in flavours across categories including juices, powder concentrates, and carbonates. Leading companies such as Coca-Cola India and PepsiCo India introduced various new flavours across the year. Smaller domestic companies including Hector Beverages and Pioma Industries also followed the suit.

The IBA has urged the government to reverse this hike as it will retard the progress of an industry which can have a significant positive impact on India?s development, particularly in the changed governance scenario in the country.

Latest Reads

http://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2018/08/06/avia.jpg?itok=njOnU16F
Casbaa becomes the Asia Video Industry Association

At an Extraordinary General Meeting of members today, Casbaa overwhelmingly approved the adoption of a new constitution and new name.

Specials Event Coverage Occasions
http://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2018/07/31/balle.jpg?itok=cQD_OGYf
Wizcraft’s 4th broadway styled bollywood musical stage show comes to kingdom of dream

After a glorious run in Mumbai with over 100 shows, Balle Balle - The Biggest and Craziest Indian Wedding Musical theatrical show, is all set to woo audiences in Delhi NCR.

Specials Event Coverage Occasions
http://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2018/07/06/asiasat.jpg?itok=31_HQ_RK
ConnecTechAsia Successful in Bridging the Digital Divide for Governments, Cities and Enterprises with Showcase of Latest Tech and Trends

ConnecTechAsia, the inaugural mega technology event comprising BroadcastAsia, CommunicAsia and the new NXTAsia wrapped up last week after an exciting three days of exhibitions and a summit covering the latest innovations in cloud, blockchain, AI, VR/AR, IoT, robotics, 5G, IP broadcasting, OTT and...

Specials Event Coverage Occasions
http://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2018/06/25/block.jpg?itok=746SRwdG
Lessons Learned With Bitcoin

Blockchain technology is one of the newest buzzwords in business. It is hardly surprising considering that the tech is having such an impact over so many different industries.

Specials Promonet feature
http://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2018/06/05/ril.jpg?itok=srJ0kbdQ
The company is collaborating with Lakme Fashion Week and designer Anita Dongre

World Environment Day - 2018 is going to be special as India is hosting global celebrations of the event today. To commemorate the occasion, Reliance Industries Ltd (RIL) has launched a special T-shirt, branded ?The Earth Tee? and designed by renowned fashion designer Anita Dongre, under its unique...

Specials Event Coverage Occasions
http://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2018/04/11/promax_0.jpg?itok=mwaud0s2
Promaxbda India 2018 announces Puja Vohra and Glenn Urquhart as their masterclass speakers

PromaxBDA India has announced its first 2 Masterclass speakers for the 15th edition of its annual conference and awards property in India, which will take place on 23rd May 2018. Speaking at the Masterclass are truTV?s Puja Vohra and creative mastermind Glenn Urquhart.

Specials Event Coverage Occasions
http://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2018/03/19/goafest.jpg?itok=82nEDNeJ
ABBY Awards 2018 shortlists announced

The coveted ABBY Awards that recognizes and rewards excellence across Advertising, Marketing and Media has now announced that the shortlists for the 2018 edition have started being posted, by category.

Specials Event Coverage Occasions
http://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2018/03/09/ficci.jpg?itok=HsYryGot
Ficci Frames and market concludes on grand note

The FICCI Frames and the newly launched content market as part of FICCI Frames 2018 concluded on a grand note.

Specials Event Coverage Ficci Frames
http://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2018/03/07/ficci_1.jpg?itok=loYrY-cA
Screen Density: Lessons from the world & Exploring new business models

n Day 2 of FICCI FRAMES happening in Mumbai, there was a session on Screen Density in India attended by some eminent panelists consisting of Mr. William Feng, VP, Greater China, MPA, Kurt Rieder, Head-Theatrical Asia, 20th Century Fox, Kapil Agarwal, Joint MD, UFO, Kamal Gianchandani, Chief of...

Specials Event Coverage Ficci Frames

Latest News

Load More

Sign up for our Newsletter

subscribe for latest stories