Imposition of 18% rate on pesticides under the Goods and Service Tax (GST) system has become a cause of worry not only for farmers but crop protection product manufacturers as well, according to an article on NewIndianExpress.com.
Manufacturers say it will increase agricultural input costs, putting additional burden on farmers as use of pesticides is essential owing to its role in controlling pest and increasing productivity.
As the current farming season is at the sowing stage, actual impact cannot be measured right now, but it will definitely have negative impact, said Rajshekhar Sakhalkar, Director of CropLife India.
CropLife India represents 14 Indian and multinational companies engaged in crop protection products.
“Before GST, the tax rate on pesticides was 14-15%. We thought it would be between 5-12% under the GST, but the government increased it to 18%. It will add to input costs for farmers. The overall cost will then increase,” Sakhalkar said.