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AGRICULTURE

There is a rumor prevailing in the market that GST law relating to farmer has been changed, w.e.f 01-06-2018, Farmer would be covered under GST law, according to which they required to get GST registration and liable to pay GST @18% on support services of agriculture, forestry, fishing, animal husbandry.

But, today Ministry of Finance clarify that the news is incorrect and misleading. Finance Ministry further clarify by Press Note that “There has been No Change in the GST law and taxation relating to farmers since July, 2017, when GST was implemented.” And Agriculturists are exempt from GST registration.


Let’s understand what is Support Services of agriculture, forestry, fishing, animal husbandry and whether they covered under GST or not!!!!!

As per Notification No. 11/2017-CT (Rate) and No. 8/2017-IT(Rate) both dated 28-06-2017, in case of support services of agriculture, forestry, fishing, animal husbandry are exempt from GST, effective from 01-07-2017.

Support Services of agriculture, forestry, fishing, animal husbandry under service group heading 9986 means,-

a) Services relating to cultivation of plants and breading of all life forms of animals, except the breading of horses, for food, fiber, fuel raw material or other similar products or agricultural produces by way of –

i) Agricultural operations directly related to production of any agricultural produce including cultivation, harvesting, threshing, plant protection or testing;
ii) Supply of farm labour;
iii) Process carried out at an agricultural farm including tending, pruning, cutting, harvesting, drying, cooling or bulk packaging etc.
iv) Renting or leasing of agro machinery or warehousing of agricultural produce;
v) Loading, unloading, packing, storage or warehousing of agri products;
vi) Agricultural extension services – i.e. application of scientific research and knowledge to agricultural practices through farmer education or training.
vii) Services of APMC or services provided by a commission agent for trading agricultural produce.

b) Services by way of pre-conditioning, pre-cooling, ripening, waxing, retail packing, labeling of fruits and vegetables which do not change or alter the essential characteristics of the said agri produce.


c) Executing intermediate production process as job work in relation to cultivation of plants.

d) Services by way of fumigation in warehouse of agricultural produce (Clause inserted w.e.f.25-01-2018).

Sources: Pib.nic.in & others


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