Indian Farm Sector Hit Hard by GST

A month after the Goods and Services Tax (GST) kicked in, the Indian farm sector is feeling the heat, with stakeholders saying the cost of cultivation has gone up and farmers may find their profession unviable, according to an article on TimesofIndia.com.

The biggest blow comes in the rate of tax on electrical agricultural appliances that have been classified under the highest tax slab, along with luxury and goods such as tobacco, soft drinks and fast food and air-conditioners.

The appliances such as agriculture motor starters, agriculture submersible pump starters, fuse units and allied switchgears used by farmers have been classified under the 28% GST slab. These equipments earlier attracted an effective tax burden of 17.5 % that included 5.5% Value Added Tax and 12.5% excise duty.

“The new tax rate on agri-electricals has dealt a body blow to both the farm sector and the small-scale industry manufacturing units these appliances,” Ratnaraj Pirgal, taxation committee head, Bengaluru Switchgear Manufacturers Association (BSMA).

Read the full story on TimesofIndia.com.

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