Goods and services tax has now started showing off some of its benefits in the sectors where it encountered hurdles before. In the same direction, GST would be giving a relaxation over the process of PAN India auction which has been recently introduced by Tea Board in June this year.
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As of now, there are various levels of taxation which are layered in each state and are levied each and every time, the tea is imported from another state. This was bit uncomfortable as to run the business operation which demanded alertness and accountability every time the production hits the bay.
ITA vice-chairman Azam Monem said on Thursday during a media conference, “Ideally, pan-India auctions could have been more suited with the GST regime. Today, there are some concerns over interstate transportation of tea.”
Sujit Patra, the ITA secretary, also gave some light over the statement, “at present, there exist multiple taxes on tea and tax rates are different on the brew in different states. “But, after the rollout of GST, there will be a uniform indirect tax rate on the commodity and that would help traders in interstate transport of their tea stocks. Traders will then find it much easier to participate in the pan-India auctions.”
At present, there is a lot of pin pressure over the industry to boost the sales graph of tea segment as it has been struggling to fetch the negotiable price to sustain the cost of production.
India being the second largest producer of Tea after china is in a very critical condition to survive in the market and has been compelled to sell the stocks under the cost of production even after the global cost of production and operation has gone high as 9.5% in four years.
Even the tea consumption is low in the country and has been stepping very slowly. ITA vice-chairman said, “Another major challenge, the industry is facing is tea consumption in India has been growing at a meager 3% rate annually. “We are worried as per-capita consumption of the brew in our country is low compared to the neighboring countries. Half of people in the age group of 15-24 are taking only one cup of tea a day. We should promote tea consumption among the young people on an urgent basis. We are promoting consumption of generic tea for this purpose,”
ITA is doing all round of practices to increase the consumption of tea in the nation while taking add-on campaign in their hands to promote the same. Coming to the GST impact on tea industry, Monem said, “Pan-India auction is in a transitional stage. ITA is studying it…We will be engaging with the Tea Board. It will iron out the problems.”
