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Call for Govt steps to attract export buyers

By Staff Reporter
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GUWAHATI, July 7 � The joint forum of the three tea producers� associations � the Assam Tea Planters� Association (ATPA), North Eastern Tea Association (NETA) and the Bharatiya Cha Parishad (BCP) � has urged the State government to initiate urgent steps for attracting the merchant exporters to the Guwahati Tea Auction Centre (GTAC). Such a step has become obligatory for the survival of the GTAC, the forum stated.

In a memorandum to the State government, the forum has said that in order to bring in the much needed competition at the GTAC, it has become imperative to attract export buyers to the centre.

Since there is no tax on export buying with no revenue implications for the State, such buyers should be allowed to register themselves as buyer members with the GTAC without getting themselves registered under the Assam Sales Tax regulations, said the joint forum of tea producers� associations. The joint forum has submitted a pre-budget memorandum to the Principal Secretary Finance with a copy to the Commissioner of Taxes, Assam on tax reforms in this connection.

It needs mention here that in 2009, the Kolkata tea auction centre (CTTA) had surpassed the GTAC in matters of sale of CTC tea. Till 2008, GTAC was the largest of the CTC tea auction centres of the country. But now, the quantity of tea sold through GTAC is in a decreasing trend as is revealed by the corresponding figures � that is, 152.14 million kgs in 2008, 137.78 million kgs in 2009 and 129.95 million kgs in 2010.

Another statistics point out that out of the Brahmaputra Valley�s total production in 2010, 26.8 per cent was sold through the Kolkata tea auction centre, while only 26 per cent of the tea produced in the valley was sold through the GTAC. Producers having their TEs in Assam reason that the difference in realization of price is one of the main factors for their sending teas to the Kolkata auction centre. The average price of CTC teas sold at GTAC was Rs 112.91 and that at the Kolkata auction centre it was Rs 121.83 in 2010.

Another main factor for better price realization at Kolkata auction centre is the presence of large number of merchant exporters. These exporters are registered under the Tea Board. They are reluctant to operate at GTAC due to the registration hassles they face with the Assam Sales Tax Department. Getting registered with the Sales Tax Department here means for them setting up their offices and other infrastructure at Guwahati. But, such set-ups are not economically feasible for small exporters.

There is no tax for export buying and hence there will be no revenue loss for the Sales Tax Dept of Assam even if the merchant exporters are allowed to buy teas at the GTAC without Assam Sales Tax registration. Modalities need to be developed on how to transfer the consignments of teas purchased by the merchant exporters from Assam to their destined areas.

The joint forum of ATPA, NETA and BCP feels that this step by the Assam government will help the tea auction centre at Guwahati to survive and prosper.

GTAC was established in the year 1970 under the initiative of the Government of Assam. Hundreds of people are directly or indirectly getting employment due to this auction centre at Guwahati, said the joint forum in its memorandum.

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Call for Govt steps to attract export buyers

GUWAHATI, July 7 � The joint forum of the three tea producers� associations � the Assam Tea Planters� Association (ATPA), North Eastern Tea Association (NETA) and the Bharatiya Cha Parishad (BCP) � has urged the State government to initiate urgent steps for attracting the merchant exporters to the Guwahati Tea Auction Centre (GTAC). Such a step has become obligatory for the survival of the GTAC, the forum stated.

In a memorandum to the State government, the forum has said that in order to bring in the much needed competition at the GTAC, it has become imperative to attract export buyers to the centre.

Since there is no tax on export buying with no revenue implications for the State, such buyers should be allowed to register themselves as buyer members with the GTAC without getting themselves registered under the Assam Sales Tax regulations, said the joint forum of tea producers� associations. The joint forum has submitted a pre-budget memorandum to the Principal Secretary Finance with a copy to the Commissioner of Taxes, Assam on tax reforms in this connection.

It needs mention here that in 2009, the Kolkata tea auction centre (CTTA) had surpassed the GTAC in matters of sale of CTC tea. Till 2008, GTAC was the largest of the CTC tea auction centres of the country. But now, the quantity of tea sold through GTAC is in a decreasing trend as is revealed by the corresponding figures � that is, 152.14 million kgs in 2008, 137.78 million kgs in 2009 and 129.95 million kgs in 2010.

Another statistics point out that out of the Brahmaputra Valley�s total production in 2010, 26.8 per cent was sold through the Kolkata tea auction centre, while only 26 per cent of the tea produced in the valley was sold through the GTAC. Producers having their TEs in Assam reason that the difference in realization of price is one of the main factors for their sending teas to the Kolkata auction centre. The average price of CTC teas sold at GTAC was Rs 112.91 and that at the Kolkata auction centre it was Rs 121.83 in 2010.

Another main factor for better price realization at Kolkata auction centre is the presence of large number of merchant exporters. These exporters are registered under the Tea Board. They are reluctant to operate at GTAC due to the registration hassles they face with the Assam Sales Tax Department. Getting registered with the Sales Tax Department here means for them setting up their offices and other infrastructure at Guwahati. But, such set-ups are not economically feasible for small exporters.

There is no tax for export buying and hence there will be no revenue loss for the Sales Tax Dept of Assam even if the merchant exporters are allowed to buy teas at the GTAC without Assam Sales Tax registration. Modalities need to be developed on how to transfer the consignments of teas purchased by the merchant exporters from Assam to their destined areas.

The joint forum of ATPA, NETA and BCP feels that this step by the Assam government will help the tea auction centre at Guwahati to survive and prosper.

GTAC was established in the year 1970 under the initiative of the Government of Assam. Hundreds of people are directly or indirectly getting employment due to this auction centre at Guwahati, said the joint forum in its memorandum.

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