Farmers’ delegation meets Nirmala Sitharaman, seek GST exemption on agricultural equipment 

A delegation of farmers’ met Union Finance Minister Nirmala Sitharaman in Mysuru on Friday and submitted a memorandum listing their various demands.
| Photo Credit: M.A. Sriram

A delegation of farmers’ met Union Finance Minister Nirmala Sitharaman here on Friday and sought that agricultural equipment and ingredients used for cultivation be exempted from Goods and Services Tax (GST).

The delegation was led by State Sugarcane Cultivators Association president Kurubur Shanthakumar who submitted a memorandum listing their demands

Mr. Shanthakumar said GST on agricultural equipment and other products used as inputs for cultivation and increased the production cost adding to the financial woes of the farmers.

Though the association has submitted many representations to the State and the Union government over the years seeking an abolition of GST on agricultural equipment and other inputs for crop cultivation, there has been no response, he added.

Ms. Nirmala Sitharaman made it clear to the delegation that there was no GST on products or equipment used strictly for agriculture but the same draws tax when used for non-agricultural purposes.

The memorandum also wanted the government to delink CIBIL score from agricultural loan. Mr. Shanthakumar told media persons that farmers tend to default on timely repayment due to the vagaries of nature. But this has a negative bearing on CIBIL score which reduces their probability of qualifying for loan.

The memorandum also mentioned that agricultural land belonging to farmers was being confiscated by financial institutions under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act (SURFAESI Act) on grounds of non-repayment of loan.

Mr. Shanthakumar told media persons that the said Act was being used for recovery of agricultural loan and farmers were in distress as their timely payment schedule was disrupted by vagaries of nature and it was not willful default. Hence the farmers wanted agricultural land to be taken out of the purview of the SURFAESI Act if not abolished altogether.

Referring to incentives given by the Union government for farmers producer organisations, the association members bemoaned that Minimum Alternate Tax (MAT) was being levied and notices were being served to the farmers. Mr. Shanthakumar said there was tax exemption to cooperative societies but MAT was being levied on farmer producers organisations and hence argued for its abrogation or exemption for 10 years.

Ms. Nirmala Sitharaman was in the city to inaugurate Mysuru Sangeetha Sunganda cultural festival organised by the Union Ministry of Tourism and Ministry of Culture, in association with Karnataka State Open University.