Agri Commodities

Union Budget 2023: Abolition Of GST & Mandi Tax Among Requests From The Agritech Sector

Union Budget 2023: Abolition Of GST & Mandi Tax Among Requests From The Agritech Sector

The agri-tech ecosystem is made up of the government and related organizations, and technology service providers, and includes well-established businesses, start-ups, as well as research and educational organizations. 

Current Scenario 

The agritech industry has requested the Union Finance Minister, Government of India, Nirmala Sitharaman, to eliminate the GST and mandi tax on agricultural products purchased from Farmer’s Producer Organizations (FPOs) and offer incentives or programs to encourage farmers to adopt new crops and technologies. 

Navneet Ravikar, chairman & managing director, of Leads Connect Services said “Apart from abolishing the GST or mandi tax on agricultural produce brought by FPOs, the universal crop insurance scheme should be launched with a 100% subsidy on premium for marginal farmers with land holding under 2 hectares. Crop insurance third-party loss assessors association should be formed for technology-based yield estimation and localized claims assessment for timely and equitable claim settlement under the Pradhan Mantri Fasal Bima Yojana (PMFBY). “ 

He added that agritech, agri fintech, and private research organizations engaged in the agricultural sector should be eligible for the grants and subsidies offered for the various drone-related programs. 

Mr.Jain, founder of Gram Unnati stated that “new crops & technologies which have the potential to drastically improve yields and returns, need to be adopted by farmers. Some incentives or schemes for setting up demonstrations will go a great distance in promoting new crops & technology adoption by farmers. These demonstrations should however be conducted in concentrated clusters at a village or gram panchayat level to enable sufficient production in one place otherwise market linkages might become a challenge. It might also be useful to incentivize the use of modern and innovative crop nutrition solutions. Schemes in this direction will reduce farmers’ dependency on Urea and DAP.” 

He lastly added that explorations could be conducted in order to support the consolidation of the FPOs and the agri-tech companies in the supply chains for agriculture, and guarantees of credit for working capital. These will make it possible for farmers to receive payments on time and for FPOs to effectively connect with markets. 

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