Assam Government to bear Rs 240-crore loss due to tea cess exemption

STAFF REPORTER

GUWAHATI: The State Government will incur an annual revenue loss of around Rs 80 crore as a result of its recent decision to exempt the cess on green tea leaf in Assam for a period of three years, which means a total revenue loss of Rs 240 crore.

Official sources said that the State Government will bear this revenue loss to compensate for the losses incurred by the tea sector in the last two-three years due to factors such as COVID-19, climate change etc.

According to Tea Board data, compared to 2019 which was a normal year, tea production in the State had fallen by 14 per cent in 2020, 7 per cent in 2021 and 13 per cent in the period between January and April this year.

The Tea Board attributes the shortfall in tea production in Assam in 2020 – around 98 million kg – to the restrictions imposed due to COVID-19. In 2021, there was a shortfall of around 49 million kg, which is attributed to a drought-like situation between January-May of that year. The Tea Board attributes the 13 per cent shortfall up to April this year to excessive rainfall during the plucking season.

Tea industry sources said that Assam produces around 700 million kg of processed tea annually. The small tea growers of the State supply 50 per cent of the green leaves required to produce the processed tea.

It may be mentioned that the cess exemption will be 10 paisa per kg for small tea growers and 40 paisa per kg for big tea gardens.

Various tea industry organizations such as ABITA, NETA etc., have expressed gratitude to the Government for the cess exemption and said that it would provide a huge relief for the industry. The organizations have also welcomed the State Cabinet's decision to allow tea garden managements to utilize 5 per cent of their land for non-tea cultivation purposes, such as horticulture, eco-tourism, floriculture etc. They said that the industry had been seeking such permission for years on end. The organizations, however, urged the Government to strictly monitor and ensure that some tea gardens do not misuse this permission.

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