New Delhi
The GST Council on Thursday approved a reduction in tax rates from 18 per cent to 5 per cent on key agricultural inputs, including tractors, machinery, fertilisers, and irrigation equipment. The move, announced in the Council’s 56th meeting chaired by Finance Minister Nirmala Sitharaman, received mixed reactions from farm unions.
The Bharatiya Kisan Sangh (BKS), affiliated with the RSS, welcomed the decision. BKS general secretary Mohini Mohan Mishra said the cut would reduce farming costs and directly benefit small and marginal farmers. “Cheaper agricultural tools will help increase food grain production,” he added. Bhartiya Kisan Union (Mann) leader Guni Prakash also praised the reduction, noting its relief for farmers and its alignment with recommendations from the government-appointed committee he is part of.
However, some unions expressed disappointment. Swabhimani Shetkari Sanghatana president Raju Shetti pointed out that the GST reduction covers only bio-pesticides, used by roughly five per cent of farmers, and demanded similar cuts for chemical pesticides and insecticides, which are widely used. A senior leader of the Samyukta Kisan Morcha (SKM) called the move “too little, too late,” adding that the organisation is still reviewing the proposal.
The Finance Ministry clarified that the GST rate on agricultural machinery such as sprinklers, drip irrigation systems, harvesters, mowers, and composting machines, previously taxed at 12 per cent, has been reduced to 5 per cent. It also explained that full exemption could hurt domestic manufacturers, as they would lose input tax credit, potentially raising production costs and, in turn, prices for farmers. The ministry said the aim is to balance relief for farmers with sustainable support for local producers.
