The United Planters Association of Southern India (Upasi) in its pre-Budget memorandum submitted to the Union Finance Minister, Mr Pranab Mukherjee, has urged for amendments to ‘Rule 8 of Income Tax Act'.
Rule 8 of Income Tax deals with income from manufacture of tea.
“Keeping in mind the long-term sustainability of plantation sector, we have asked Union Finance Ministry for suitable amendments to Rule 8,” Mr D. Hegde, President of Upasi, told
Huge variation
“Currently it is unsustainable as there is large variation in the agriculture income-tax rates from State to State. For example, it is 50 per cent in Kerala and nil in Tamil Nadu,” he added.
Upasi has asked for a mechanism which may provide aggregate of the central income tax and agriculture income tax payable by an assessee for income from the business of growing and manufacture of plantation crops exceeds the amount of tax payable by him.
“If this entire income were to be assessed under Central Income Tax Act, then the excess tax so arrived at should be allowed as a rebate against his liability for tax under Central Income Tax,” Mr Hegde said.
He further said that the association has asked the Ministry to provide benefits to encourage the exports and to earn foreign exchange by way of deduction in respect of profits retained for export business needs to be reintroduced.
Indirect taxes
Mr Hegde said, the concessional import tariff extended to plantation sector was discontinued in the last Union Budget. Since the modernisation of plantation sector is dependant on latest technologies and machineries, it is requested that the concession on import tariff be introduced, along with full excise/CVD exemption.
Upasi has requested for inclusion for the following machineries for tea and coffee sector under the concessional import tariff:
For tea sector — automatic and semi-automatic fresh brew tea vending/ dispensing machines for brewing tea, chain saws for shade lopping, cutting and felling, versatile hedge trimmers for bush skiffing, earth augers/ soil augers for making planting pits and fencing, telescopic pruners for shade lopping.
For coffee sector — automatic and semi-automatic fresh brew coffee vending/ dispensing machine including coffee espresso machines for industrial use, coffee grinders, coffee roasters, coffee makers including espresso machines for domestic use, coffee huller machines and mechanical driers for drying coffee,” he explained.