The Hindu Business Line : Kerala urged to waive VAT on poultry

THE Broiler Coordination Committee in Tamil Nadu has asked the Kerala Government to revisit its VAT rate of 12.5 per cent being levied on live chicken sold there.

It has called upon the Kerala Government to do away with the tax by treating the poultry sector as part of the agriculture as is being done in West Bengal, the BCC Chairman, Mr R. Lakshmanan, has said in a statement. He said the 12.5 per cent tax burden not only affected the poultry farmers who are already operating on a thin margin but also pinches the consumers in that State.

Kerala is the only State that levies VAT on poultry, which is an exempted item in almost all the States, according to Mr Lakshmanan.

At a time when the Centre and the State Governments have set a minimum 3-4 per cent growth target for agriculture, taxing poultry will decelerate the overall agriculture growth rate. Though at present, the festival demand has kept the broiler prices at a moderate level of Rs 32 per kg, the price of chicken tends to fall during other times for want of demand.

This scenario forces the average annual price of live birds keeping below Rs 26 per kg. Under such a situation, taxing 12.5 per cent would really cause problem for the poultry farmers and the trade, the BCC has said.

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