Agri Business

Campco seeks reduction in GST for arecanut, copper sulphate

Our Bureau | | Updated on: Nov 20, 2021
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Requests drop to 2 per cent for arecanut and to 5 per cent for copper sulphate

The Central Arecanut and Cocoa Marketing and Processing Cooperative (Campco) has sought the reduction of GST on arecanut and copper sulphate.

In a letter to the Karnataka Chief Minister Basavaraja Bommai, the convenor of the group of Ministers to review the rate slab structure, the President of Campco, Kishore Kumar Kodgi, said GST of 5 per cent is charged on arecanut and 18 per cent on copper sulphate.

Unregulated traders

Requesting the GST Council to reduce the rate of arecanut from 5 per cent to 2 per cent, he said such measures would encourage farmers to sell their produce to cooperatives and regulated marketing committee platforms, and would discourage them from going to unregulated traders who do not remit applicable tax to the Government.

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“It is observed that the unscrupulous trader network lures agriculturists to sell their produce to the unorganised sector without creating documents for such transactions. Gullible agriculturists fall prey to the small rate advantage being passed on by the unscrupulous traders through evaded taxes, and do not bring their produce to cooperatives for sale. In this process, there is loss of revenue to the Government’s exchequer through evaded GST during processing and supply of agri-produce,” Kodgi said.

Campco is of the opinion that a reduction in GST slab to 2 per cent would definitely attract all traders to become tax compliant and thus bring transparency in trading, he said, adding that this would help the Government generate more revenue.

Fertiliser GST rate of 5 per cent

Copper sulphate is mainly used in controlling fungal diseases in coffee, arecanut, rubber, cardamom and pepper, and as a plant nutrient in ginger. So it, as a micronutrient, attracts a GST of 12 per cent, and as a fungicide, a GST of 18 per cent.

Quoting a 2017 order of the Union Ministry of Agriculture and Farmers Welfare, Kodgi said micronutrients are classified as fertilisers attracting a GST of 5 per cent.

Since it is mainly small growers who use copper sulphate as a fungicide, Kodgi requested the Government to fix GST rate on copper sulphate used in agriculture at 5 per cent.

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A uniform rate of tax should be levied for agricultural purpose, and copper sulphate should be brought under one chapter with single HSN Code to avoid confusions, he said.

Requesting the GST Council to reduce GST on arecanut and copper sulphate, he said it would be in the best interest of arecanut, rubber and pepper growers.

Published on November 20, 2021

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