BENGALURU: Goods and Services Tax has hit farm machinery manufacturers and farmers very hard as the current tax rate is 12%, up from 5.5% under the earlier VAT system. Farm machines include threshers, drip irrigation system, harrow and cultivators.
Similarly, the tax rate on pesticide sprayers has increased three folds to 18% from 6% and on electric motors it has gone up to 12% from 7%. However, on some machineries like multi-craft engines, it remains at 28%.
The farmers in the city are demanding a reduction of GST on high tech agricultural equipment. "Irrigation costs have gone up by half the price and we are finding it difficult to adopt high-tech farming because of the price. Earlier these machineries were available at a reasonable rate," said Venkatesh, a farmer.
Professor H.G. Ashoka, Department of Agriculture Engineering, GKVK said, "Farmers are facing a lot of difficulties in today's scenario. They are not even getting the margin for their investment. Earlier, the VAT rate on agricultural machineries was 5.5% and now under GST it is 28% which was later reduced to 18%."