Micro-fertiliser manufacturers call for uniform GST and simplified licensing

The Indian Micro-Fertilizers Manufacturers Association (IMMA) has sought a series of policy changes from the Centre ahead of the Union Budget, including extending a uniform 5 per cent GST rate to all fertilisers covered under the Fertilizer Control Order (FCO), expediting GST input credit refunds, and introducing a single national licensing framework.

The demands were conveyed on Sunday by IMMA president Rahul Mirchandani, according to a PTI report. The association welcomed the move towards “GST 2.0”, particularly the reduction of GST from 12 per cent to 5 per cent on Schedule 1G items and their mixtures. However, it flagged concerns over the inverted duty structure in the fertiliser sector, where manufacturers pay a higher GST on raw materials than on finished products.

“This leads to the accumulation of excess input tax credit, resulting in a significant working capital blockage for manufacturers,” said Mirchandani, who is also the chairman of Aries Agro Limited. IMMA urged the government to ensure faster refunds of accumulated GST credits, noting that timely refunds are critical for price-controlled sectors such as fertilisers. “Speedier refunds will ease working capital stress and allow manufacturers to invest more in product quality, capacity expansion, and farmer outreach,” he added.

The association reiterated its demand for a uniform 5 per cent GST rate on all fertilisers notified under the FCO. According to Mirchandani, “A common GST rate would create a level playing field, reduce classification disputes, and encourage innovation without tax-related distortions.”

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