Plea for uniform VAT

Staff Reporter

‘There is a need to start an “aggressive campaign for promoting tea consumption”’

COIMBATORE: The Planters’ Association of Tamilnadu (PAT) has appealed to the State Government to implement the concessional one per cent Value Added Tax (VAT) on all teas.

Addressing the annual general meeting of the association here recently, its chairman, T. Jayaram, said the concessional rate was now available only to teas sold by Bought Leaf Tea Factories and the Industrial Co-operative Tea Factories.


The rest of the plantation factories, including the corporate tea factories, were excluded. States such as Assam and West Bengal charged VAT at one per cent on all teas sold in their respective auction centres.

Further, a lower rate of four per cent VAT was announced by the Government for unbranded coffee and chicory, while the same products if branded would attract 12.5 per cent.

This would lead to “consumer resistance when the need of the hour is an expansion of coffee consumption domestically,” he said.

Developmental package

Mr. Jayaram also urged the Central Government and the plantation growing State Governments to jointly evolve a developmental package for agriculture and plantations. A committee of experts and administrators should be formed to study the impact of global free trade on agriculture and rural industries, including plantations.

Further, to improve domestic tea consumption there is a need to launch an “aggressive campaign for promotion of tea consumption”, he said.

The All India tea production in 2006 was 955.9 million kg as against 928 million kg in 2005. Tamil Nadu produced 152.2 million kg in 2006 as against 154.6 million kg in 2005.

On the price front, the upward trend witnessed in 2006 was short-lived, he said.

South India accounted for 22 per cent of tea acreage in the country.

Tamil Nadu had 1.35 lakh hectares under different plantation crops.

Recommended for you