India’s BKS Farmer Body Calls For Removal of Key Tax on Agricultural Items

A majority of the agriculture sector in India is exempted from the Goods and Services Tax (GST), the consumption tax used on the supply of goods and services. Although there's no GST on seeds used for sowing, the tax is levied on fertilizers, pesticides, and tractors, the main components of crop harvesting in the country.

The Bharatiya Kisan Sangh (BKS), an affiliate farmer organization of the Rashtriya Swayamsevak Sangh (RSS), has appealed to the federal government to remove the Goods and Services Tax (GST) from items like fertilizers, pesticides, and tractors to reduce farmers' input costs.

According to the farmers' body, removing GST from items that are essential for harvesting new crops is vital to make agriculture "profitable" in the country.

"Security of food grains is important but safety and security of farmers has never been in the agenda of the governments. The farmers have ensured the food security of the country by ensuring maximum produce. But till now the condition of the farmer remains the same," Sai Reddy, the secretary of the BKS, was quoted as saying by The Hindu newspaper on Tuesday.

Meanwhile, another BKS official, Mohini Mohan Mishra, urged the central government to provide fair prices to farmers for their crops.

"To improve the economic condition of farmers and to make agriculture profitable, the government will have to abolish the GST on agricultural inputs. Also, we demand that the government must increase the amount of Kisan Samman Nidhi (Prime Minister's Farmer's Tribute Fund) in proportion to the increase in inflation in agricultural inputs," Mishra said.

As per a report by the Department of Agriculture and Farmers Welfare, nearly 55 percent of India's population is engaged in agriculture and associated activities.

Despite more than half of the population's reliance on agriculture, it contributes only 16 percent to India's GDP.

To raise the income of the country's farmers, Prime Minister Narendra Modi's government introduced the Prime Minister's Farmer's Tribute Fund in 2019.

Under the initiative, farmers are provided ₹6,000 ($73) annually. The scheme has put an additional $10 billion burden per year on the exchequer.