5.
Subsidies And Tax Rebates
On Meat Processing And Export
Taxes on processed food in India are among the highest in the world. No other country imposes excise duty on processed food.
No country distinguishes between branded and unbranded food sectors for taxation. There is excise duty of 16% in the form of CENVAT levied on food products and then there is sales tax, octroi, mandi samiti, entry tax and customs duty on material, levied by the Central/State/Local bodies. The net effect ranges from 21% to 30% on various food items. India is the only country to have levied excise duty on machinery and equipment for processed foods. Indian consumers are very price-sensitive and cost reductions are imperative to raise demand and consumption of food products. Since the net effect of various taxes falls directly on the price, the off-take of processed food items remains low. Consider the Food and Vegetable sector, where against the installed capacity of 21 lakh tonnes (of the units registered under FPO), present production is only 9.4 lakh tonnes or about 45%.
But all these tax strictures apply only to the non-meat products. When it comes to meat products, it’s a different ball game altogether. In fact, meat is the most subsidized commodity and meat sector is the most pampered sector in the entire Indian economy.
Everything related to meat - raising animals, their slaughter, transportation, retail outlets, pre-cooling facilities, cold storage, brand publicity, quality control, packaging development, brand publicity, export and even shipping is subsidized by the government.
Ignoring millions of children who die of malnutrition every year, the central government is spending thousands of crores to subsidize an industry which only serves vested interests - mostly underworld mafia and big agribusinesses. Meat is being made increasingly available to few meat eaters in the country while the prices of vegetables, grains and milk are doubling every year.
Some excerpts from the website of the Ministry of Food Processing Industries:
There are no restrictions on exports of poultry and poultry products. The government provides some transportation subsidies (Rs 3-15 per kg) for its exports. There are a number of issues that need to be addressed to fructify and ensure the growth for the current markets, industry sources expressed.
For the development of meat export from India the industry has demanded some immediate measures like financial assistance for upgradation of export oriented abattoirs/processing plants, inclusion of cattle meat under APEDA’s Transport Assistance Scheme for new markets in Africa/CIS where freight cost from India for reefer containers is much higher than from competing countries, restoration of DEPB rates for frozen cattle meat, exemption from Service Tax on transportation of meat products processed for exports.
(http://mofpi.nic.in/ContentPage.aspx?CategoryId=173)
Below is an article which sheds further light on the subject. It was published in Times of India on August 10, 2012.
No country distinguishes between branded and unbranded food sectors for taxation. There is excise duty of 16% in the form of CENVAT levied on food products and then there is sales tax, octroi, mandi samiti, entry tax and customs duty on material, levied by the Central/State/Local bodies. The net effect ranges from 21% to 30% on various food items. India is the only country to have levied excise duty on machinery and equipment for processed foods. Indian consumers are very price-sensitive and cost reductions are imperative to raise demand and consumption of food products. Since the net effect of various taxes falls directly on the price, the off-take of processed food items remains low. Consider the Food and Vegetable sector, where against the installed capacity of 21 lakh tonnes (of the units registered under FPO), present production is only 9.4 lakh tonnes or about 45%.
But all these tax strictures apply only to the non-meat products. When it comes to meat products, it’s a different ball game altogether. In fact, meat is the most subsidized commodity and meat sector is the most pampered sector in the entire Indian economy.
Everything related to meat - raising animals, their slaughter, transportation, retail outlets, pre-cooling facilities, cold storage, brand publicity, quality control, packaging development, brand publicity, export and even shipping is subsidized by the government.
Ignoring millions of children who die of malnutrition every year, the central government is spending thousands of crores to subsidize an industry which only serves vested interests - mostly underworld mafia and big agribusinesses. Meat is being made increasingly available to few meat eaters in the country while the prices of vegetables, grains and milk are doubling every year.
Some excerpts from the website of the Ministry of Food Processing Industries:
There are no restrictions on exports of poultry and poultry products. The government provides some transportation subsidies (Rs 3-15 per kg) for its exports. There are a number of issues that need to be addressed to fructify and ensure the growth for the current markets, industry sources expressed.
For the development of meat export from India the industry has demanded some immediate measures like financial assistance for upgradation of export oriented abattoirs/processing plants, inclusion of cattle meat under APEDA’s Transport Assistance Scheme for new markets in Africa/CIS where freight cost from India for reefer containers is much higher than from competing countries, restoration of DEPB rates for frozen cattle meat, exemption from Service Tax on transportation of meat products processed for exports.
(http://mofpi.nic.in/ContentPage.aspx?CategoryId=173)
Below is an article which sheds further light on the subject. It was published in Times of India on August 10, 2012.
‘Withdraw Subsidies To Meat Exporters’
Times News Network, Aug 10, 2012
The Central government has been urged to abolish subsidies to meat trade and exports which is not only taking toll on productive cattle but is also creating shortage of milk. “There is an immediate need to arrest the present practice of indiscriminate slaughter of young and productive animals. Otherwise, the problem will intensify and the country will have to face acute shortage of milk,” said Kanakrai Savadia, managing trustee of Sukrut Nirman Charitable Trust, an organization working to save cows in Vidarbha.
Cow protection is our life. Krsna has ordered, 'krsi-go-raksya.' Cow protection at any cost. It is Krsna's order. We have to execute it. Any government allowing slaughterhouses should be removed, but we are not so powerful.
~ Srila Prabhupada TKG’s Diary: July 13
In a memorandum submitted to Anand Sharma, the union minister of commerce and industry, Savadia has said the prevailing high prices of bovine, milk and meat are strong indication of shortage of supply. Even existing slaughterhouses are not able to meet requirements. Hence, they are procuring buffaloes by illegal means.
The next symptom of the age of Kali is the distressed condition of the cow. Milking the cow means drawing the principles of religion in a liquid form. The great rsis and munis would live only on milk. Srila Sukadeva Gosvami would go to a householder while he was milking a cow, and he would simply take a little quantity of it for subsistence. Even fifty years ago, no one would deprive a sadhu of a quart or two of milk, and every householder would give milk like water. For a Sanatanist (a follower of Vedic principles) it is the duty of every householder to have cows and bulls as household paraphernalia, not only for drinking milk, but also for deriving religious principles. The Sanatanist worships cows on religious principles and respects brahmanas. The cow's milk is required for the sacrificial fire, and by performing sacrifices the householder can be happy. The cow's calf not only is beautiful to look at, but also gives satisfaction to the cow, and so she delivers as much milk as possible. But in the Kali-yuga, the calves are separated from the cows as early as possible for purposes which may not be mentioned in these pages of Srimad-Bhagavatam. The cow stands with tears in her eyes, the sudra milkman draws milk from the cow artificially, and when there is no milk the cow is sent to be slaughtered. These greatly sinful acts are responsible for all the troubles in present society. People do not know what they are doing in the name of economic development. The influence of Kali will keep them in the darkness of ignorance. Despite all endeavors for peace and prosperity, they must try to see the cows and the bulls happy in all respects. Foolish people do not know how one earns happiness by making the cows and bulls happy, but it is a fact by the law of nature. Let us take it from the authority of Srimad-Bhagavatam and adopt the principles for the total happiness of humanity.
~ Srila Prabhuapda (Srimad Bhagavatam 1.17.3)
The most unfortunate fallout of this has been the deleterious effect on small farmers. They are lured to sell their animals, but soon discover that it is impossible to buy fresh stock again. The slaughterhouses involved in export are killing productive cattle clandestinely to fulfil their export commitments.
Savadia said in India farmers mainly rear cattle for agriculture purpose as well as milk production. When the animal grows old and is not fit for either milk production or agricultural purpose, it is sold at throwaway prices to the traders involved in meat export. Thus the traders get animals at an extremely low cost. To fulfil the demand these animals are even stolen and slaughtered.
In abattoirs even milk-giving animals are slaughtered illegally to meet the export demand of traders. He pointed out that slaughterhouses maintained and run by local bodies are meant for domestic requirement of meat and not export. Yet, these establishments are involved in illegal export of meat.
Savadia said despite violations subsidies are offered by the Central and state governments for construction and upgradation of slaughterhouses and the prevailing meat trade in the country.
Savadia said in India farmers mainly rear cattle for agriculture purpose as well as milk production. When the animal grows old and is not fit for either milk production or agricultural purpose, it is sold at throwaway prices to the traders involved in meat export. Thus the traders get animals at an extremely low cost. To fulfil the demand these animals are even stolen and slaughtered.
In abattoirs even milk-giving animals are slaughtered illegally to meet the export demand of traders. He pointed out that slaughterhouses maintained and run by local bodies are meant for domestic requirement of meat and not export. Yet, these establishments are involved in illegal export of meat.
Savadia said despite violations subsidies are offered by the Central and state governments for construction and upgradation of slaughterhouses and the prevailing meat trade in the country.
At the present, especially on this planet earth, the influence of Lord Brahma has decreased considerably, and the representatives of Hiranyakasipu—the Raksasas and demons—have taken charge. Therefore there is no protection of brahminical culture and cows, which are the basic prerequisites for all kinds of good fortune. This age is very dangerous because society is being managed by demons and Raksasas.
~ Srila Prabhupada (Srimad Bhagavatam 7.3.13)
He said the Agriculture Agricultural and Processed Food Products Export Development Authority (APEDA) is providing 25% to 60% subsidy on transport of meat, pre-cooling facilities, cold storage, brand publicity, quality control, packaging development, brand publicity etc.
In addition, there is exemption from sales tax and income tax. The modern export-oriented slaughterhouses are mostly run by private players who earn huge profits at the cost of our water bodies and environment, causing pollution and diseases.
Savadia urged Sharma to withdraw all the subsidies offered to meat trade. “The subsidy of thousands of crores of rupees from taxpayers’ money is not justifiable from any angle,” he added.
In addition, there is exemption from sales tax and income tax. The modern export-oriented slaughterhouses are mostly run by private players who earn huge profits at the cost of our water bodies and environment, causing pollution and diseases.
Savadia urged Sharma to withdraw all the subsidies offered to meat trade. “The subsidy of thousands of crores of rupees from taxpayers’ money is not justifiable from any angle,” he added.
Centre Slammed Over Subsidy for Beef Exports
October 28, 2012, Outlook
Gujarat chief minister Narendra Modi today reiterated the charge that the Centre was promoting beef exports by providing subsidies even while levying duty on cotton exports.
Speaking at the 4th Annual General Meeting of the Jain International Trade Organisation here, Modi said “The UPA government allows subsidy to open slaughterhouses, whereas cotton farmers are levied duty for exporting cotton”.
He alleged that to facilitate mutton exports, tax is waived off for five years. “The union government does not want another green revolution and white revolution, but wants to promote pink revolution,” Modi alleged, adding that he had to approach the Supreme Court to get a law enacted to ban cow slaughter in his state.
He said that it is possible to bring change within the system if motives are noble, intentions are clear and policies are coherent.
Speaking at the 4th Annual General Meeting of the Jain International Trade Organisation here, Modi said “The UPA government allows subsidy to open slaughterhouses, whereas cotton farmers are levied duty for exporting cotton”.
He alleged that to facilitate mutton exports, tax is waived off for five years. “The union government does not want another green revolution and white revolution, but wants to promote pink revolution,” Modi alleged, adding that he had to approach the Supreme Court to get a law enacted to ban cow slaughter in his state.
He said that it is possible to bring change within the system if motives are noble, intentions are clear and policies are coherent.
Vegetarians have the best diet. They have the lowest rates of coronary disease of any group in the country... they have a fraction of our heart attack rate and they have only 40 percent of our cancer rate. On the average, they outlive other people by about six years now."
~William Castelli, M.D.,
Director, Framingham Heart Study, the longest-running epidemiological study in medical history.
