News Tamil Nadu

No, Cream Buns Don’t Have 18% GST, Annapoorna Hotelier’s Claims Exposed

September 15, 2024
The Commune

Recently, D. Srinivasan, Managing Director of Sree Annapoorna Hotel, stirred up controversy by questioning Union Finance Minister Nirmala Sitharaman about the GST regime. He highlighted the anomaly of an 18% GST on cream-filled buns compared to no GST on plain buns, urging the Minister to address this discrepancy, which he claimed was causing difficulties with customers. Although the issue quickly went viral and served as an effective marketing strategy, it turns out that the entire claim was misleading.

Since the video of hotelier D. Srinivasan confronting Union Minister Nirmala Sitharaman and later apologizing went viral, the cream bun has also gained significant attention, trending across the state. On 13 September 2024, the restaurant even shared a promotional video on Instagram featuring their cream buns, with the tagline, “That’s trending across India. Cream + Bun = Cream-Bun.”

Social media users and influencers are flocking to Sree Annapoorna Hotel to purchase the popular cream bun, following a recent controversy. Managing Director D. Srinivasan had highlighted that sweets are taxed at 5%, savouries at 12%, and cream-filled buns at 18%, while plain buns are exempt from GST. He humorously noted that customers often say, “Just give me the bun; I’ll add the cream and jam myself,” which elicited laughter from the crowd.

However, the situation has taken a troubling turn. Despite the cream bun being sold with only a 5% GST, it was inaccurately promoted as having an 18% GST. This discrepancy led to viral attention and coordinated videos from opposition parties like the DMK and Congress, criticizing the BJP’s GST policies. This misinformation campaign resembles a toolkit that suddenly appears and then vanishes, leaving those affected as the true victims. Netizens are now countering previous claims and ridiculing those who propagated the unverified narrative.

Critics argue that the video clearly shows the GST on cream buns is 5%, not 18% as previously claimed by the Annapoorna owner during the meeting with FM Nirmala Sitharaman. This incorrect information fueled an entire misinformation campaign. Since then, Sree Annapoorna and its owner have apologized for the incident, likely due to the provision of incorrect facts. The issue should now be considered closed. What was overlooked in the entire controversy is that the government was open to listening to business grievances, and the meeting was intended to address such concerns. It is unfortunate that only the sensational aspects were highlighted.

Background

On 11 September 2024, Union Finance Minister Nirmala Sitharaman met with entrepreneurs from various sectors, including small and micro industries, at the Kodisia campus in Coimbatore. The event, organized by Codisia and Lagu Udyog Bharati Industrial Organization, saw participation from business owners across Coimbatore, Tirupur, and Erode districts. Coimbatore South MLA Vanathi Srinivasan also attended the event, which provided a platform for the entrepreneurs to discuss their concerns and raise demands directly with the Finance Minister.

Entrepreneurs Present Demands

During the meeting, several entrepreneurs from diverse sectors voiced grievances regarding GST rates, loan schemes, and other pressing issues affecting their businesses. One of the key demands was from hoteliers, represented by Srinivasan, the chairman of Sri Annapurna Hotel, who highlighted the inconsistencies in GST rates. He pointed out that different rates were applied to items on the same bill, causing customer confusion and dissatisfaction.

“There is 5% GST on sweets but 12% on savouries, and 18% on cream-filled buns, whereas there is no GST on buns! Customers often complain, saying, ‘Just give me the bun, I’ll add the cream and jam myself,’“ said Srinivasan, leading to laughter from the crowd.

He emphasized the need for a uniform GST rate on food items, particularly in Tamil Nadu, where sweet and savoury items are consumed together.

Taking a dig at BJP MLA Vanathi Srinivasan, he said, “So please increase it uniformly for everything. Secondly, this MLA, madam, is from our constituency. She said in the North of India, they are eating too many sweets, so the GST has been fixed at 5% and 12% for savouries. I said no. In TN, we call it sweet karma coffee (sweets, savouries, and coffee). So please consider it, madam; please make it uniform.”

Srinivasan further criticized the complexity of the GST system, stating, “The computer crashes when we try to input different GST percentages in a single bill. Even the GST officials are confused, as all items have the same input but different tax rates. This inconsistency is causing issues for both shopkeepers and customers.”

In response, Union Finance Minister Nirmala Sitharaman acknowledged the entrepreneurs’ concerns, stating that the government was working to simplify the GST system. She assured the attendees that she would bring these concerns to the GST Council, particularly the varying tax rates on food items. Sitharaman highlighted that GST, Customs, Income Tax, MSME, EOB, and Canara Bank officials had come from Delhi to address the grievances of the industrialists. “We will take steps to address each petition given,“ she assured, adding that 1,500 outdated industrial laws have already been removed, and 40,000 complaints have been resolved nationwide.

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