GST Cuts to Benefit 10 Crore Dairy Farmers and Rural Enterprises

In a major relief for the rural economy, the central government has announced significant cuts in Goods and Services Tax (GST) rates across various sectors. This reform is expected to directly benefit nearly 10 crore dairy farmers, especially those associated with rural cooperatives and self-help groups.

Under the new GST structure, milk and cheese, branded or unbranded, have been made completely tax-free. The GST on butter, ghee, and other milk products has been reduced from 12 percent to 5 percent, while milk canisters made of iron, steel, or aluminum will now also attract only 5 percent tax. These changes will reduce input costs and boost incomes for dairy farmers.

The food processing sector has also seen major tax relief. GST on items like cheese, snacks, pasta, jam, jelly, yeast, bhujia, and fruit-based drinks has been reduced to 5 percent. Products such as chocolates, ice cream, pastries, cakes, biscuits, and coffee, previously taxed at 18 percent, will now also be taxed at just 5 percent, making them more affordable and increasing demand in rural markets.

In packaging and logistics, GST on packing materials like paper, cans, and boxes has been brought down to 5 percent. The agriculture machinery sector will benefit from a GST cut on tractors below 1800cc, as well as parts like tyres, tubes, and hydraulic pumps, all reduced to 5 percent.

For the fertilizer sector, GST on key inputs like ammonia and sulfuric acid has been lowered to 5 percent, reducing production costs. GST on 12 bio-pesticides and micronutrients has also been slashed.

Additionally, GST on goods vehicles has been reduced from 28 percent to 18 percent, and insurance tax has dropped to 5 percent.

These reforms aim to increase farmer incomes, reduce rural costs, and boost rural entrepreneurship.