Tea traders in Coimbatore appealed to the Centre to exempt tea from the levy of the proposed Goods and Services Tax (GST) and remove it from the list of taxable items under the GST Act. If total exemption was not possible, tea should at least be exempted from GST at the first point sale made in the public tea auction centres, licensed by the Tea Board of India, Tea Traders Association of Coimbatore Chairman UV Saraf said.
For subsequent sales, the rate should be fixed, not exceeding 5 percent, he said in his address to the 34th Annual General Meeting of the association. He said though the association members welcomed the introduction of GST scheduled from April next year, they had certain apprehensions as tea will fall under the category of 18 percent Revenue Neutral Rate.
Presently, VAT is charged at 5 percent for estate teas and a concessional 1 percent for Bought Leaf Factory teas in Tamil Nadu, he said, and appealed to lawmakers to take up the matter with the State and Central governments to get total exemption from GST for auction sales throughout the country or a minimum rate since tea was an agricultural produce of mass consumption.
On the pan-India e-auction system implemented from June last, Saraf said the association wanted the participation of more buyers in the platform, which can create competition for quality tea and ensure fair price realisation for the manufacturers.
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