The Indian finance ministry should consider current VAT rate, CST on interstate sales and APMC additions before finalizing the GST rate on cashew.
Sellers pay 2% CST on interstate transactions. Their domestic turn over includes both with in the state and interstate sales. Therefore the average should be considered as only 1%. This kind of average method is also good for the calculation of APMC levy. So the GST rate should be VAT rate + 1% + 50% of the current APMC levy.
APMC addition is a big burden on traders. They are compelled to pay this addition on behalf of farmers of the state where they trade. There is no APMC on imports from other countries or on interstate purchases. Only the trader who make purchases with in the state and supports the farmers of his own state is the sufferer! Indirectly, poor farmer of the state is the real sufferer as every trader considers this levy before making any purchases.
APMC addition is not a tax. Then what it is ? Is it a service charge or a compulsory donation ? The state governments argue that this is a market fee payable on services but purchases from outside the state is not in their jurisdiction.
The electricity board gives monthly bill of their services on individual meters. The telephone department gives monthly bill on individual connections. Local bodies also give periodic bill on individual water consumption.
However, APMC collects huge sum from traders without giving any individual bill describing the used or consumed services.