In India, excise duty ranges from eight per cent to 18 per cent on processed food and 40 per cent on carbonated drinks. The study points out that octroi on food items is levied only in India while other Asian countries do not levy it. In India, Maharashtra levies the highest seven per cent octroi on processed food. Sales tax in India averages second behind that in China.

The study was confined to identifying duty levels in India, Indonesia, Philippines, Malaysia, Sri Lanka, China, and Thailand.

The objective of the study was to identify taxes and duties on specified food and food equipment in different Asian countries and also compare the said taxes and duties with those prevailing in India.

Theduty impact on food processing should be reduced to achieve increased investment, higher value to the basic food producer, increased scope for exports, reduce import duties and excise on food machinery. The Confederation of Indian Industries (CII) asked for the study to be conducted based on `Faida' a McKinsey report on the Indian food processing sector which points out that level of taxation in India's food industry is exceptionally high by international standards. Excise duty on machinery is levied only in India. Processing machinery attract 13 per cent excise duty and 18 per cent on packaging and vending machinery. The food processing machinery attracts highest import duty in India.

The recent Budget imposed eight per cent excise duty on all branded food products including packaged tea, dairy items, edible oil. The industry did not welcome this move as it will encourage sale of lose food products to avoid excise duty. This will lead to unhygienic and adulterated food products, it said.