In a similar event, the meeting with the Finance Minister Yaduveer Krishnadatta Chamaraja Wadiyar the MP for Mysuru demanded the continuation of the grant exemption on black pepper continued in New Delhi. This exemption is very appealing to farmers in the Kodagu, Hassan, and Chikkamagaluru districts of Karnataka. In this regard, Wadiyar pointed out that the imposition of the GST on black pepper might affect in negative ways the farmer’s and India’s export competency.
During the meeting, Wadiyar of Kodagu enlightened the Finance Minister about some of the issues with people from the pepper-growing region of Kodagu who had received notices from the Mysuru-based GST office. According to the notices, they related that their pepper sales would stipulate GST and that they were obliged to register under the GST Act. This is because there was confusion about the process that is used to dry the peppers.
Effect of GST on pepper farmers: Moreover, Wadiyar pointed out that the drying process is a method of preservation of food that does not change the physical quality of black pepper. The more imposing GST on dried pepper affects the plantation districts of Karnataka, Kerala, and Tamil Nadu by increasing the cost of food products, decreasing the profits hence possibly promoting the loss of jobs. Besides, it might be potentially detrimental to the export sector of India – the company’s home country, which would reduce its market appeal.
Proposal for HSN Code Revision: Subsequently, the MP proposed that dried pepper prepared and processed by the farmers for the purpose of increasing the period of storage should be covered under a different HSN code and should, therefore, be out of the tax base of the GST. As Wadiyar contended while vouching for this exemption as it can be an agricultural product and the existing HSN codes for black and green peppers can be employed.
Request for Assistance In his memorandum, Wadiyar asked the Finance Minister to help the agricultural community from losing the GST exemption for black pepper. He thanked her for such a positive approach, which would help farmers in major pepper-producing areas in the near future.
