To encourage the agriculture sector in the capital, Delhi cabinet has decided to waive off the value added tax on fertilizers. This decision was taken in a cabinet meeting chaired by chief minister Sheila Dikshit.

While talking to the media persons after the Cabinet Meeting, Dikshit said the government has been receiving representations from the farmers requesting substantial relief on VAT being levied on fertilizers. It was stated in the representations that the farmers have been facing difficulties due to high tax rate on fertilizers and there has been a significant difference in the prices of fertilizers in Delhi and the neighbouring state of Haryana on account of difference in tax rates.

It may be recalled that fertilizer items mentioned at serial no.73 and 188 of the 1{+s} {+t} Schedule were being taxed at the rate of 5% while the items mentioned at serial no. 20 of the 3rd Schedule were being taxed at the rate of 12.5% VAT with effect from April 1, 2010.