FSII welcomes GST warehousing exemption for seeds, seeks clarity on proposed tax changes

Agri Inputs

New Delhi: The Federation of Seed Industry of India (FSII) has welcomed the GST Council’s recommendations to exempt storage and warehousing services for seeds meant for sowing, saying the move could reduce costs for the seed industry. The federation has also called for clarity on two other tax proposals that could affect business costs and working capital. In a statement issued on October 17, FSII said the proposed exemption, recommended at the 57th GST Council meeting in New Delhi, addresses a long-standing cost for the seed value chain. Seeds continue to be nil-rated under GST, with no change in their applicable tax rate. However, GST paid on seed storage and warehousing services has so far been an unrecoverable cost for the industry. The proposed exemption is expected to ease this burden at a critical stage in the supply chain, as proper storage helps preserve seed quality and viability before the sowing season. FSII also welcomed proposed reforms aimed at improving export competitiveness. These include faster, system-based refunds and expanded eligibility for refunds of input tax credit on capital goods for eligible seed exporters. According to the federation, the measures could improve cash flow and reduce the financial burden on businesses...