Krishi Kalyan Cess

Q.  Which of the following charges are meant for welfare of farmers?
- Published on 21 Mar 16

a. Krishi Kalyan Cess
b. Krushak Kalyan Cess
c. Farmer Welfare Cess
d. Agriculture and Farmer Cess

ANSWER: Krishi Kalyan Cess
 
  • There will be a Cess, called the Krishi Kalyan Cess, @ 0.5% on all taxable services.
  • The proceeds of this would be exclusively used for financing initiatives relating to improvement of agriculture and welfare of farmers.
  • The Cess will come into force with effect from 1st June 2016.
  • Input Tax credit of this cess will be available for payment of this cess.
  • The effective rate of the Krishi Kalyan Cess, however, will be lower than 0.5 per cent as the government will provide input tax credit for the cess, as against no input tax credit for Swachh Bharat Cess.

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