• Notification Date: 30-11-2022
• Notification No: N/A

Odisha CM urges Nirmala Sitharaman to withdraw 18% GST on Kendu Leaf

Odisha chief minister Naveen Patnaik wrote a letter to the union finance minister Nirmala Sitharaman on Saturday requesting her to consider withdrawal of centre-levied goods and services tax (GST) on Kendu leaf in the state. The GST imposed on Kendu leaf was highly affecting the trade and livelihoods of locals who are dependent on it.  

Patnaik has urged Nirmala Sitharaman to roll back the 18% GST applied on Kendu leaf in Odisha for the sake of the local inhabitants. Lakhs of people associated with the trade of Kendu leaf are getting affected, he added. 

“The tribal people collect the leaves as part of their right defined under Scheduled Tribes (ST) and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006. They have the right to procure and sell these products,” said Patnaik. He wrote that the 18% GST which is imposed on Kendy leaf is majorly affecting the trade, as well as livelihoods of Kendu leaves pluckers, binders & seasonal workers and the implementation of the social security and welfare schemes for them. 

In the letter, Patnaik wrote that Kendu is a minor forest produce in Odisha. But it is the financial backbone of about 8 lakh leaf pluckers, binders and seasonal workers. Most of these people belong to the tribal community and poorest sections of Odisha. Hence, the imposition of GST on Kendu leaf is creating a negative impact on the implementation of welfare schemes. 

Odisha government used to charge 5% VAT on Kendu leaf before the implementation of GST. But after GST was introduced in July 2017, a GST of 18% is being levied on Kendu leaves. Out of this total tax, 9% is central GST and 9% state GST. As a matter of fact, the traders who get the tender from Odisha Forest Development Corporation to collect Kendu leaves, are paying even less to the tribals collecting the leaves since the tax rate is too high. 

Odisha CM on Wednesday announced a special package for the welfare of 8 lakh Kendu leaf pluckers and other persons engaged in the trade. This development is to be highlighted in the upcoming assembly by-poll in Padampur of Bargarh district next month. 

In the first phase of the development program, ₹1,000 will be given to each plucker and ₹1,500 to each seasonal staff and binders, said Patnaik.