Patiala: The high rate of tax charged by Punjab Government and Mandi Board has compelled the traders to purchase wheat from neighbouring states.

Presently, Mandi Board is charging 10 percent market fees, three per cent rural development fund, 5 percent VAT and 2.5 percent infrastructure development tax from the traders.  Compounding to the miseries of the traders, 0.5 percent goes to commission agent and workers expense.

Statistics of wheat purchase in Patiala district reveals that mere 0.02 percent wheat was purchased by traders and the domestic users. Out of the total purchase of 7.90 lakh tonne wheat in the district, private sector traders have purchased only 2621 tonne wheat.

It clearly indicates that by deceiving the official records, wheat is being purchased in the district as seeds. Or the poor purchase rate is an outcome of the Value Added Tax (VAT) imposed on the agricultural yields, which is pushing the private sector out of competition. 

The high rate of tax charged by Punjab government and Mandi Board has raised the price of wheat considerably. By the time, wheat reaches the Mandi from the agricultural fields, the price witnesses a rise by 15 per cent.

Mill involved in the manufacturing of bread, biscuit, bakery and flour have purchased their annual stock from the adjoining states.
The official sources disclose that private traders have shifted focus to Uttar Pradesh (UP) and Rajasthan for purchasing wheat. In UP, with no Minimum Support Price (MSP), wheat is sold at Rs 1050 per quintal. Traders pay 7 percent tax in UP while Rajasthan government has removed all tax on the purchase of wheat. 

In Punjab wheat is sold at Rs 1300 per quintal including bonus.  District Mandi official GS Aulakh says, “There is no bar on transportation of wheat in the state. Therefore, a trader will divert towards others states only when he gets a profit of Rs 100 per quintal.”