New Delhi: The Federation of Seed Industry of India (FSII) has welcomed the recommendations of the 57th GST Council meeting, held recently in New Delhi, terming the proposed GST exemption on storage and warehousing services for seeds meant for sowing a significant positive for the seed value chain.
Seeds continue to be nil-rated, with no change in the applicable GST rate. However, GST paid on storage and warehousing of seeds has so far been an unrecoverable cost for the industry. The proposed exemption removes this cost at a stage critical to preserving seed quality and viability ahead of each sowing season.
The Federation also welcomed measures aimed at export competitiveness. Faster, system-based refunds and expanded eligibility for refunds of input tax credit on capital goods could improve cash flows for eligible seed exporters, said the apex industry body in a release.
Proposed reforms to e-way bill interception, registration and penalties could reduce compliance burdens for seed companies, dealers and distributors, who move consignments across states within narrow sowing windows.
FSII flagged two proposals that require attention: 5% GST without input tax credit on specified e-commerce delivery services, and 2% TDS on specified B2B waste and scrap transactions. Both may have cost or working-capital implications for affected businesses, and the Federation will seek clarity on their scope and application to the seed sector, the release said.
“The Council’s recommendations reflect a clear focus on ease of doing business, and the warehousing exemption addresses a long-standing cost in the seed value chain,” said Ajai Rana, Chairman, FSII. “Quality seed is the foundation of farm productivity, and every measure that reduces costs across storage, movement and exports ultimately strengthens farmers’ access to it. We will assess the implications of the proposed changes with our members and engage constructively with the Government on implementation clarity, so that no segment of the industry faces a disproportionate compliance or cost burden,” he added.
Most of the procedural reforms recommended by the Council are expected to take effect from 1 April 2027.
BI Bureau
