Punjab waives purchase tax on sugarcane for 2014-15

The Punjab government on Tuesday waived purchase tax on sugarcane for the current financial year, providing a relief to state-based private sugarmills.

A decision to this effect was taken by the state Cabinet meeting held here under the chairmanship of Chief Minister Parkash Singh Badal, an official spokesman said.

"The Cabinet accepted the recommendations of the committee headed by state chief secretary with regard to waiver of purchase tax on sugarcane for the year 2014-15 as done by Uttar Pradesh, Maharashtra and Uttarakhand," he said.

With cane crushing under process in the state, Punjab- based private sugarmills have been seeking from the state government rollback of purchase tax on sugar, saying low sugar prices had hit the industry hard.
 

At present, the purchase tax on sugar is Rs 13-14 a quintal in Punjab.

A total of 100,000 hectares is under sugarcane in Punjab, with cane production and sugar estimated to be 72 million quintals and 4.8 million quintals, respectively, for 2014-15 crushing season.

There are 16 sugarmills, including seven in private sector in Punjab, with crushing capacity of 49,766 tonnes crushing a day.

The Cabinet also decided to recover the previous arrears of purchase and other taxes from the sugar mills in annual equated installments, the spokesman said.

"These decisions were taken in view of the uneconomic operations of the sugar mills all over the country due to increasing cane price and stagnant prices of sugar. The government intends to support sugar mills so that farmers continue to cultivate sugarcane," he said.