New Delhi, 7 December. The reduction of Goods and Services Tax (GST) on micronutrient fertilizers from 12 percent to 5 percent will help reduce the farming costs for small and marginal farmers. This was stated by Union Chemicals and Fertilizers Minister JP Nadda.
The government implemented GST reforms on 22 September, which included tax cuts on fertilizers and several agricultural products.
Nadda said that the lower input cost has encouraged farmers to use micronutrients more effectively.
He added, “According to the Indian Micronutrient Manufacturers Association, reducing GST from 12 percent to 5 percent will save Rs 140 per acre in paddy, Rs 199 per acre in sugarcane, Rs 446 per acre in potato, and Rs 146 per acre in wheat.”
The minister also highlighted that cutting GST on crucial raw materials for fertilizer production, such as ammonia and sulphuric acid, from 18 percent to 5 percent has lowered the working capital requirements, reduced the accumulation of input tax credit, and improved cash flow for manufacturers. This will boost domestic production and help farmers access essential soil nutrients.
GST on bio-pesticides has also been reduced from 12 percent to 5 percent, which will decrease input costs and promote wider adoption of integrated pest management practices.
Additionally, GST on mechanical sprayers, sprinklers, drip irrigation systems, and nozzles has been cut from 12 percent to 5 percent, expected to encourage modern farming techniques.
The Union Minister stated, “These reforms will make plant protection and irrigation equipment more affordable, motivating farmers to adopt scientific spraying methods and efficient pesticide application technologies.”
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