Union Minister for Chemicals, Fertilizers and Parliamentary Affairs, Ananthkumar said the decision to reduce the GST rate of fertilizers from the existing 12% to 5% was primarily taken in the interests of the farmers

New Delhi: Union Minister for Chemicals, Fertilizers and Parliamentary Affairs, Ananthkumar said the decision to reduce the GST rate of fertilizers from the existing 12% to 5% was primarily taken in the interests of the farmers.

Briefing media after the 18th meeting of the GST Council here on Friday, the minister said their government had also taken up with the Industry to pass on this benefit to the farmers.
The farmers would benefit to the tune of Rs. 1261 crores under GST regime. Under the new GST rates announced by the Council, average weighted MRP would decrease to Rs. 5909/ Ton (or Rs. 295.47/ 50kg bag) as compared to the existing All India weighted Average of Rs 5923/ Ton (or Rs. 296.18/50 kg bag), said Ananth Kumar. 
Consequent to the ushering in of the GST regime, he also informed, there would be a uniform MRP of Rs.295.47 per 50 kg bag across the country except couple of States where additional VAT is charged on the natural gas as Natural gas has not been brought within the ambit of GST.

However, even in these States, MRP will reduce by Rs 3 per 50 kg bag. Similarly, MRP of P&K Fertilisers, for which the prices are not administered, are also expected to come down on an average basis as the incidence of tax will be lower than the existing tax on an average, he added. 
The GST regime, apart from integrating the entire fertilizer market into a single market, will also deter inter-state smuggling of fertilizers which may be currently happening due to differing levels of taxes and consequently MRPs in different adjoining States.