Home / Politics / Policy /  Kerala abolishes plantation tax, announces moratorium on agriculture income tax

Bengaluru: Kerala chief minister Pinarayi Vijayan on Thursday announced a slew of initiatives in the assembly, including abolition of plantation tax, moratorium on agriculture income tax and legislation to take over closed estates, claiming to revive the crisis-driven plantation sector.

Blessed with verdant green valleys, Kerala has some of the biggest tea, rubber and other plantations in the south. It is the single largest private employer in the formal sector and forms almost 42% of the state’s gross value of total crop production.

The sector, however, have been bogged down by lower price realization, high production cost, among others, so much so that the total turnover crashed from about Rs20,000 crore five years ago to Rs9,751 crore last year.

The plantation tax was an age-old levy that existed only in Kerala and much contested between the government and the planters. Although welcome, abolishing or freezing such additional levies would do not much to save the sector, said Vinay Raghavan, vice president of Harrisons Malayalam Plantation, one of the biggest players in the state market, and former president of Kerala Planters Association.

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