Bengal tea workers seek tax revision; Tea Board remains firm

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SME Times News Bureau | 26 Feb, 2015
Tea companies and workers' unions Wednesday called for revising the tax structures in the sector, even as the Tea Board of India ruled out any modifications in central taxes saying the present system was optimal for the industry.

West Bengal Joint Forum of Trade Unions of Tea Industry said the current tax system in the tea industry is burdening the sector, which is affecting the tea workers as well as plantation owners.

"The government levies agricultural income tax besides corporate tax which is overlapping," Ziaul Alam, a leader of the trade union consortium, told reporters.

"It is an industry which is taxed right from the beginning of soil preparation to cultivation and finally to the end-product. It needs to be reformed."

"The entire tax structure needs to be reformed and simplified," he said, adding that the central and state governments should invest the taxed money to raise standards in the industry.

"We want the government to invest in tea the same amount it taxes," he said.

Alam said the government earns at least Rs.5,000 crore from tea export taxes alone.

Tea producer Andrew Yule and Company also said that taxes need to be revised.

Asked over his opinion on the current tax structure, Kallol Datta, managing director and chairman of the company said: "Yes, the tax structure in tea industry needs to be revised and looked into."

The Tea Board of India, however, said the central government only charges 50 paisa cess or excise duty on every kilogramme of tea which does not need any revision.

"The centre only charges the excise duty (domestically) while all other taxes including agricultural income tax, sales tax, salami on land and others are charged by the state government under the present tax structure, central taxes don't need any revision," S. Soundararajan, director of tea development at Tea Board of India, told agency.