The Agricultural Machinery Manufacturers’ Association (AMMA) has urged the Central and State Governments to exempt value added tax (VAT) and other taxes on agricultural machinery.
“Farm mechanisation is a key area in the policy framework of both the Governments. To help farmers acquire machinery at an affordable price, all kind of taxes such as VAT, CST and entry tax should be removed,” said Baldev Singh, President of AMMA.
“Taxing agricultural machinery is counter productive. The Governments are giving subsidy to make it affordable for the farmers and on the other, they are charging various taxes making it expensive,” he told Business Line.
Similarly, AMMA has also urged both the Centre and State Governments to solve a few problems faced by machinery manufacturers. Singh said: “At present only few States such as Chhattisgarh, Odisha and Gujarat have adopted online subsidy distribution. This system is functioning well and more States should come forward to adopt this mechanism. This system is helpful to both farmers and the machinery manufacturers. Simultaneously both can check their status of application helps timely approvals and facilitate subsidy disbursal.”
AMMA has also asked the Governments to increase percentage of subsidy for hi-tech machines.
“Hi-tech machines should be provided to the farmer at a higher percentage of subsidy such as may be up to 75 per cent to improve adoption of these at a faster rate for higher productivity,” said Singh.
The sector is also bogged down with inadequate testing centres in the country. Singh said: “one of the biggest achievements for us is the approval and establishment of 27 testing centres of agricultural machinery in the country.”
“There were only four centres and this posed a challenge for us. Now at least there is one centre in each state. This is likely to speed up adoption of farm mechanisation in the country,” he added.
The association, according to Singh, is also spearheading a move for exemption from testing for subsidy.
“Many of the machines such as cultivators, disc harrow, chaff cutter etc are being manufactured since decades and are popular among the farmers. These machines should not require testing as these are already refined technologies,” he said.