GoI may provide relief to tea gardens from TDS in cash withdrawal


Government of India is in process to reframe the policy of charging TDS on cash withdrawal for Tea gardens. Highly labour intensive tea industry had always remained vocal against the policy since its introduction in 2019.

“Following our discussion on the issue, the Finance Minister has taken it into her consideration. While agreeing to the problems of tea sector associated to the policy, she has assured to bring in proper reforms in it,” BJP Loksabha MP from the heartland of Indian tea Darjeeling Raju Bista, told ET at a event organized by Siliguri Tea Traders Association.

“Government may not withdraw the policy. But can postpone it for tea sector till infrastructure becomes adequate enough in the far flung tea garden areas,” said Bista.


As per the policy, one needs to pay TDS at a rate of 2% for withdrawal of any amount in excess of Rs 1 crore in a year.

Workers payment contributes 45 to 60% to total operational cost of a tea garden. Traditionally, tea workers prefer taking payment in cash. But the new policy shifted it to bank though banking infrastructure is nowhere near adequate in deep interiors tea garden areas. “Most of the banking facilities opened during demonetization are also no more active. So, for every withdrawal workers need to travel to city that causes heavy loss of working day for garden and wage for them. Eventually, we had to roll back to cash payment shouldering heavy extra taxation load”, said M Bansal, President, Terai Indian planters Association.

“We have repeatedly requested to exempt tea sector from this,” said Bansal. The same was requested by almost all other tea entrepreneurs’ organizations in the country including Indian Tea Association.

On the other side, “It is not viable to maintain banking infrastructure or ATM in all gardens,” accepted a senior Banker.

Thus, restructuring of the policy can come as a major relief to the tea sector that is India’s one of the largest labour intensive arenas with almost 25 lakh workers direct involvement in it.

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