Rice shellers told to provide information about crop purchase

Tax dept ask exporters to pay tax before hand seek refund later

The Punjab government has asked state rice shellers to provide information about crop purchase and sale to the excise and taxation department. The move follows after tax sleuths found some of dealers or rice exporters were not paying due purchase tax on paddy on the
pretext of exporting rice.

Punjab levies 5 % of purchase tax on paddy.

"We have found that some of people (rice trade) do not export full quantity of rice. They export rice partially (and as a result of it), full purchase tax is not accounted for," Punjab Excise and Taxation Commissioner A Venuprasad said today.

He said, therefore, the department has decided that rice shellers would provide information about purchase of paddy or basmati rice and its sale from Punjab to other states.

This measure is expected to keep a check on "illegal diversion" of crop to evade tax, official sources said. With Punjab being an agrarian state, the government collects major chunk of tax revenue from agricultural commodities. The state this year is expecting to collect about Rs 900 crore from paddy crop, Rs 100 crore more than what it realised last season, on the back of heavy arrival.

Excise and taxation department has also asked the rice exporters to first pay the tax at the time of paddy purchase and they can claim refund after rice is exported out of the paddy.

"Those rice exporters who have export orders are not required to pay purchase tax (at the time of purchase). But those who do not have export orders should pay tax first on paddy purchase and thereafter if they get orders, they are eligible to
claim refund," Venuprasad said.

Excise and Taxation department has said that any taxable person purchases paddy within the state will have to pay purchase
tax on the same.