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Assocham urges Centre to review GST levied on bio-fertilisers & manure
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Friday, 14 July, 2017, 08 : 00 AM [IST]
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Our Bureau, New Delhi
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The Associated Chambers of Commerce and Industry of India (Assocham) has urged the Centre to review the rates of goods and services tax (GST) levied on select agricultural inputs, including bio-fertilisers, bio-pesticides/bio-control agents (BCA) and organic manures/vermicompost/farmyard manure (FYM).
“If the GST levied on agricultural inputs is higher, it will directly promote chemical usage, thereby leading to increase in greenhouse gas (GHG) emissions. Moreover, it will also adversely impact public health,” stated the apex industry body in a communication addressed to finance minister Arun Jaitley.
Assocham also noted that such a taxation policy on these segments will directly contradict the efforts being made by prime minister Narendra Modi to promote a variety of schemes and projects, including Swachh Bharat, Soil Health Card, Namami Gange and a host of organic missions.
“The GST Council has recommended that far higher tax rates be levied on specific manufactured products that are either exempted in several states like West Bengal, Sikkim and Uttarakhand, or attract the basic five per cent value-added tax (VAT) charges in the majority of the states,” said D S Rawat, secretary general, Assocham.
Highlighting the importance of bio-fertilisers, the chamber, in its representation, said, “They are manufactured primarily by micro-, small- and medium-sized enterprises (MSMEs) and also provide farmers an option towards sustainable agriculture practices like organic farming.”
Besides, bio-fertilisers are highly beneficial, as they are alternate solutions to chemical fertilisers, which tend to spoil both the soil and the environment.
“While bio-fertilisers have so far been left out of the tax ambit by the majority of the states, including West Bengal, even the National Bank for Agriculture and Rural Development (NABARD) provides additional support to this sector in form of 50 per cent subsidy for setting up such units,” said Rawat.
Just like bio-fertilisers, bio-pesticides and bio-control agents are also used extensively for organic farming and integrated crop management practices.
The government of India is promoting the use of these beneficial micro-organisms in various schemes of the agricultural and allied sectors, though their adaptability is very low.
Assocham’s representation to the finance minister also highlighted that presently, bio-pesticides/bio-control agents are taxed in the five or six per cent bracket by the majority of the states, but on the basis of their certifications, they are exempt from paying excise and other taxes.
Similar to the bio-fertilisers segment, they are also provided subsidy and other benefits for setting up such plants.
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