GST Rate Cuts to Directly Benefit Farmers: FM Sitharaman

GST Rate Cuts to Directly Benefit Farmers: FM Sitharaman

Finance Minister Nirmala Sitharaman stated that the recent Goods and Services Tax (GST) rate rationalization, which reduced taxes on numerous goods, is specifically intended to provide direct financial benefits to farmers.

Key Benefits for the Farming Sector

• Cheaper Agricultural Inputs: The GST cuts were strategically applied to various agricultural tools, machinery, and equipment components, directly reducing the purchase cost for farmers. This boosts the affordability of farm mechanization.
• Lower Cost for Essential Supplies: The reduction in GST on various essential supplies used in agriculture (such as certain processed fertilizers, seeds, and irrigation systems) reduces the overall operational expenses for farmers.
• Support for Agro-Processed Products: The rate cuts on many agro-processed food products (moving rates, often from 12% to 5%) increase their affordability for the final consumer. This higher demand supports the entire farmer-to-market value chain, securing better prices and market offtake for agricultural produce.
• Economic Stimulus: The Minister emphasized that by lowering costs and stimulating demand, the GST reforms support the profitability and resilience of the agriculture sector, which is crucial for the overall economy.