New Delhi, Sept 6 (UNI) Over 10 crore dairy farmers across the country will benefit from the government’s recent overhaul of the Goods and Services Tax (GST) in key sectors.
These reforms will strengthen the cooperative sector, make their products competitive, increase demand or their products and increase income of cooperatives. It will promote rural entrepreneurship, promote cooperatives in food processing sector and ensure affordable access to essential goods for millions of households, an official statement said.
GST rate reductions will benefit cooperatives in farming and animal husbandry, promote sustainable farming practices, and benefit small farmers and FPOs. The Next Gen GST reforms has been hailed by the entire dairy cooperative sector, including the big cooperative brands like AMUL.
In the dairy sector, direct relief has been provided to farmers and consumers as milk and paneer, whether branded or unbranded, have been exempted from GST, while the tax on butter, ghee and similar products has been reduced from 12 percent to 5 percent, and GST on milk cans made of iron, steel or aluminium has also been lowered from 12 percent to 5 percent.
In food processing and household items, a major relief has been given as GST on cheese, namkeens, butter and pasta have been reduced from 12 percent or 18 percent to 5 percent, while jams, jellies, yeasts, bhujia and fruit pulp or juice-based drinks are now taxed at 5 percent. Chocolates, corn flakes, ice creams, pastries, cakes, biscuits and coffee have also seen a reduction from 18 percent to 5 percent.
Additionally, GST on packing paper, cases and crates has been reduced to 5 percent, easing logistics and packaging costs for cooperatives and food producers.
The GST on tractors below 1800 cc has been reduced to 5 percent, which will make tractors more affordable and benefit not only crop farmers but also those engaged in animal husbandry and mixed farming. While tractor components such as tyres and tubes, hydraulic pumps, and several other parts have also seen a reduction from 18 percent to 5 percent.
GST on key fertiliser inputs such as ammonia, sulphuric acid and nitric acid has been reduced from 18 percent to 5 percent.
Similarly, GST on twelve bio-pesticides and several micronutrients has been reduced from 12 percent to 5 percent, promoting eco-friendly and sustainable farming practices.
The GST on commercial goods vehicles such as trucks and delivery vans has been reduced from 28 percent to 18 percent, lowering the upfront capital cost of trucks which form the backbone of India’s supply chain. The reduction of GST on third-party insurance of goods carriage from 12 percent to 5 percent with Input tax Credit (ITC), further complements these efforts.
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