Increase GST on agriculture inputs will affect productivity

President Pakistan Kissan Ittehad (PKI) Khalid Mahmood Khokhar reacting to news of the increase in GST on agriculture inputs has said that if implemented this will result in disaster for Growers.

Increase GST on agriculture inputs will affect productivityKhalid Mahmood Khokhar said GST must be kept at the current zero percent for Pesticides and Seeds while GST on fertilizer must also be reduced to zero percent from current 2 percent.

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He informed that an increase in GST on Fertilizers from the current 2 percent to 17 percent will increase fertilizer prices by Rs300 per bag of UREA, Rs530 per bag of DAP, Rs630 per bag of SOP Potash, Rs460 per bag of MOP Potash and Rs220 per bag of AS.

In case of UREA, entire price reduction due to GIDC reduction will be taken back by GST increase. Increase in GST on pesticides, seeds and agricultural machinery will increase the cost of farming and will make it impossible for farmers to maintain per acre yields of all the crops.

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Khokhar said that such a step to increase GST will reduce per acre yield of crops in Pakistan. Growers are already hand to mouth. They don’t have the money to buy expensive Agricultural crop inputs. This will reduce Agricultural output of the country in a big way. This will lead to economic disaster for the country and result in food shortage.

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The loss of GDP through lower agricultural production will be many times larger than any additional revenue generated by the Government through an increase in GST on agriculture inputs.

He proposed that the Government must declare Agricultural Emergency instead of GST increase and reduce the cost of agricultural production by reducing the cost of agriculture inputs.

GST on all agriculture inputs including fertilizers, pesticides, seeds and Agri machinery must be zero per cent.

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