Bengaluru, March 3

Dal millers in Madhya Pradesh have urged the State government to reduce the tax on pulses sourced from other States as higher mandi tax is resulting in flight of business to neighbouring States.

Madhya Pradesh levies a mandi tax of 1.7 per cent, almost twice that of neighbouring Maharashtra (0.8 per cent) and over three times imposed in Gujarat (0.5 per cent). The State government had introduced a mandi tax of 1.7 per cent in 2020 when the Covid-19 pandemic set in, said Suresh Agarwal, President of the Indore-based All India Dal Mills Association. Prior to 2020, dal mills were exempted from mandi tax, he said.

States such as Bihar and Delhi have zero mandi tax, while Uttar Pradesh levies 1.5 per cent, lower than MP, Agarwal said.

Stiff competition

As a result of the higher mandi tax, pulses processed by mills in Madhya Pradesh such as tur dal and chana dal among others are expensive by about ₹1 per kilogram, Agarwal said. This has resulted in stiff competition from pulses processors in Gujarat, Maharashtra, Karnataka and Andhra among other States and has led to lower capacity utilisation.

“We have urged the State Government to reduce the mandi tax to 0.5 per cent to make us competitive,” Agarwal said. In this regard, the industry association has submitted a memorandum to the Shivraj Singh Chouhan Government.

Madhya Pradesh, one of the major growers of pulses such as chana and tur among others, has over 700 processing units in the State. Dal industries in the State periodically, resort to purchases of pulses such as moong, tur/arhar and urad beans from the neighbouring States to process into dals.