NEW DELHI: In an attempt to take the sting out of opposition that the goods and services tax (GST) is against farmers’ interest, the GST Council on Friday cut the tax rate on fertiliser from 12 per cent to 5 per cent and exclusive parts of tractors from 28 per cent to 18 per cent.
Speaking to reporters after the end of the 18th GST Council meeting on Friday, Finance Minister Arun Jaitley said the Council had approved an additional set of rules and reduced the rate on fertiliser and tractors.
He said, “The matter was raised in response to a number of representations made against the 12 per cent rate, which some felt would have increased the burden on farmers… There was consensus in the Council on bringing the rate down to 5 per cent so that the price of fertiliser, if at all, comes down and does not go up.”
Jaitley said the decision to reduce the tax rate on fertiliser was taken because of apprehensions that price of the crop nutrient may go up. He said that the issue of reducing the cost on certain important parts of tractors came up and the Council agreed to reduce it to 5 per cent. But, he did not disclose any other details.
The Council meeting was called more as a ‘thanks giving’ meet with no formal agenda. Prime Minister Narendra Modi hosted a dinner for the GST Council members as a special thanks giving for the decisions the panel took since its formation in September last year.
The next meeting is expected to take up real estate and petroleum-related issues, sources said.