Odisha Chief Minister Naveen Patnaik has written a letter to Union Finance Minister Nirmala Sitharaman, urging her to withdraw the 18% Goods and Services Tax (GST) on Kendu leaves. Patnaik emphasized that the GST has had a negative impact on the local trade and livelihoods of those dependent on Kendu leaves.
Kendu leaves play a crucial role in the livelihoods of approximately 8 lakh people in Odisha, primarily tribal communities. These leaves are used for making bidis, which are hand-rolled cigarettes. The imposition of GST on Kendu leaves took place in November 2017.
Patnaik highlighted the challenges faced by the Kendu leaf trade in competing with states that do not have GST on this product. He also emphasized that the GST makes it difficult for the government to implement social security and welfare programs for Kendu leaf workers.
As the chairperson of the GST Council, Sitharaman holds the authority to determine GST rates. Patnaik has requested the GST Council to consider withdrawing the GST on Kendu leaves during its upcoming meeting.
The imposition of GST on Kendu leaves has sparked controversy since its introduction. Some argue that GST ensures fair compensation for Kendu leaf workers, while others contend that the high GST rate is detrimental to the Kendu leaf trade.
The decision to withdraw the GST on Kendu leaves rests with the GST Council. However, Patnaik’s letter demonstrates the significance of this issue for the Odisha government.
