Campco Urges UP Government to Abolish Mandi Tax on Arecanut to Boost Industry Growth
The Central Arecanut and Cocoa Marketing and Processing Cooperative (Campco) Ltd has urged the Uttar Pradesh government to eliminate the ‘mandi’ tax imposed on arecanut sold by cooperatives. A delegation from Campco, including its President and Managing Director, raised concerns during a meeting with Chief Minister Yogi Adityanath regarding the adverse effects of this tax on legitimate trade, which has made them less competitive compared to unorganised market entities. The imposition of ‘mandi’ tax, coupled with an APMC cess already charged at the point of origin in Karnataka, results in double taxation for arecanut, significantly impacting the cooperative’s business operations and contributing to a decline in turnover.
This situation directly affects the common citizen, particularly the over 1.50 lakh farmers associated with Campco. The additional tax burden not only complicates trade for cooperatives but can also lead to higher market prices for consumers, as these costs may be passed down the supply chain. The reduced competitiveness of organized trade operations may push consumers toward unregulated markets, undermining the efforts to establish transparency and fair pricing in the agricultural sector. The closure of Campco’s sales depot in Kanpur highlights the pressing need for policy changes that would ensure sustainable growth for cooperative organizations and stabilize prices for consumers.
Looking ahead, the long-term outlook may depend on the response from the Uttar Pradesh government. The Campco delegation was assured of a sympathetic review of their concerns, suggesting that discussions around tax relief are forthcoming. If the government acts to remove the ‘mandi’ tax or provides exemptions for cooperatives, it could pave the way for enhanced trade channels, protecting the interests of farmers while strengthening revenue generation through legitimate business practices. Such measures would be a step towards boosting the cooperative model in agriculture, vital for the sustainability of this sector in the region.
Source: The Hindu
(Expert Note: This report was independently prepared by the Wealthova Economy team.)