Mysuru: Mysuru-Kodagu MP Yaduveer Krishnadatta Chamaraja Wadiyar met Finance Minister Nirmala Sitharaman to request the continued exemption of pepper from Goods and Services Tax (GST).
“Met Finance Minister Nirmala Sitharaman to discuss GST exemption for black pepper, a vital issue for farmers in Kodagu, Hassan and Chikkamagalur districts. Requested continuation of the exemption, citing its classification as agricultural produce and the potential negative impact on farmers and exports,” Yaduveer Wadiyar posted on X.
In his letter, a copy of which was released to the media yesterday, Yaduveer explained that members of his Constituency, particularly from Kodagu, have received notices from the GST Office in Mysuru. These notices state that the sale of pepper grown on their plantations is subject to GST and that the planters must register under the GST Act.
Drying a preservation technique
“The GST notice arises from a misunderstanding regarding the drying process. Pepper growers have informed me that drying is simply a preservation technique and does not fundamentally alter the essential characteristics of pepper,” the MP said.
The letter argued that the GST Act’s definition of agricultural produce aligns with the nature of pepper and pointed out that similar commodities like paddy and chillies are treated as non-taxable. Therefore, classifying pepper as taxable is inconsistent.
Wadiyar warned that imposing GST on pepper could have significant negative consequences for the plantation districts of Karnataka — Kodagu, Hassan, and Chikkamagalur — as well as for the growers in Kerala and Tamil Nadu.
“It could lead to increased costs, reduced profit margins and potential job losses. Moreover, it could hurt exports, reducing India’s competitiveness in the global market,” he added.
In his letter, Wadiyar requested that dried pepper be assigned a separate HSN code and exempted from GST after the green pepper drying process.
Codagu Planters Association’s plea
On Aug. 20, a delegation from the Codagu Planters Association (CPA) met MP Yaduveer, requesting his intervention to secure GST exemption for black pepper and cardamom.
The delegation, led by CPA Chairman A. Nanda Belliappa, emphasised that GST authorities have been issuing notices to coffee growers, insisting on GST registration due to the tax on black pepper. Belliappa informed the MP that while green pepper is exempt from GST, dried black pepper attracts tax.
Commenting on Yaduveer’s meeting with Nirmala Sitharaman, Nanda Belliappa said that ongoing representation helped the MP fully grasp the issue. “He has articulated the letter correctly to the Finance Minister, and we planters hope that the Minister agrees to our demands,” he said.
This post was published on September 18, 2024 7:41 pm