I don't think that the taxes on restaurants are very high, says Siraj Hussain
I don't think that the taxes on restaurants are very high, says Siraj Hussain

Food processing sector is one of the largest sectors in India in terms of production, growth, consumption and export, says Siraj Hussain, Secretary, Ministry of Food Processing Industries. Restaurant India caught hold of Hussain to gain an expert insight in food management and processing industry.

On Government’s support to food processing sector

The Government of India is committed to providing support to the food processing sector especially with a view to reduce losses in supply chain. Usually, the losses range from about 6-18 per cent in various crops and during certain seasons (especially rainy season), the losses can be as high as 30 per cent. The government is concerned about the losses, especially in fruits and vegetables, because it reduces the availability of food products as it fuels inflation. Hence, the government is providing a number of incentives to food processing industry, food preservation industry so that there is facility of integration from the farm to the fork.

On taxes imposed on restaurants

In order to provide government meeting their other requirements, it is necessary that the richer people share the bottom. So, I don’t think that the taxes on restaurants are very high. In fact, there is a need to ensure that the payments at restaurant are made through card, cheque or mobile transfer so that the restaurant business is able to collect their money through reportable channels.

On the benefits of processed foods

The Food processing sector is planning to reach Rs 873,000 crore by 2015-16. Restaurants are now having access to processed food products which can be used in cooking, which means that the products are of certain quality, they are fresh and can save significant amount of time while cooking. Not only the quality is reliable, the shelf life is also longer. All these factors benefit restaurant owners.

Advice for food retailers

As far as food retailers are concerned, we have seen a lot of modernisation in the last few years. A number of modern retail formats have come up and non-retail formats have also modernised their shops. Now the shops have refrigerators, coolers in the shops, and the shops have become more hygienic. They need to get a license from the Food Safety and Standard authority of India. This will result in better management of shop level sale which will reduce the losses, improve storage life and will be more attractive to customers. Hence, all these things will encourage more investment in the food processing sector. 

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