Assam Budget 2026-27: Tea Sector Welcomes New Subsidies and Incentives

The Assam Budget for 2026-27 has been positively received by the tea industry, with various associations applauding the new subsidies and incentives. Key measures include a Rs 3 per kg export subsidy for premium CTC tea and a reduction in VAT on piped natural gas. These initiatives aim to bolster the tea sector's global competitiveness and improve the socio-economic conditions of workers. Additionally, the budget proposes a unique Assam Tea and Golf Trail to enhance tourism. This comprehensive support is expected to significantly benefit tea growers and strengthen the industry as a whole.

By Narendra Chaudhary Jul 11, 2026, 13:26 IST

Positive Reactions from the Tea Industry

A file image of tea garden workers in Assam. (Photo: @ExecutivePinX/ X)

Guwahati, Jul 11: Various associations within the tea industry, including those representing planters and traders, have expressed their approval of the subsidy, incentive, and tax relief measures announced in the Assam Budget for 2026-27, highlighting that these initiatives will significantly benefit the sector.

The budget proposals, presented in the assembly on Friday, are expected to help the tea industry maintain its global market presence while also enhancing the socio-economic conditions of its workforce.

The Guwahati Tea Auction Buyers Association (GTABA) hailed the introduction of a Rs 3 per kg export subsidy for premium CTC tea as a groundbreaking move.

According to GTABA secretary Dinesh Bihani, this marks the first dedicated export incentive for premium Assam CTC tea.

"This initiative will enable exporters to stay competitive in the international market, especially as the industry faces heightened competition and increasing logistics expenses. It will also enhance price realization throughout the value chain," he stated.

Bihani noted that the Guwahati Tea Auction Centre (GTAC), which is the largest CTC tea auction house in India, is likely to gain substantial benefits from this initiative.

The Tea Association of India (TAI) remarked that the budget has provided a significant boost to the tea industry across various aspects.

"The tea sector is a cornerstone of the state's economy and plays a crucial role in generating employment," said TAI secretary general PK Bhattacharjee.

He praised the subsidies for both orthodox and premium CTC tea, adding that the reinforcement of the Assam Tea Industries Special Incentives Scheme (ATISIS) 2020 will further support the industry.

Additionally, the reduction of VAT on piped natural gas from 14.5% to 5% is expected to lower production costs for tea estates utilizing piped natural gas.

Bhattacharjee also highlighted the proposal to introduce the Assam Tea and Golf Trail, a unique tourism initiative that will combine Assam's famous tea estates with its golf courses, creating a world-class tourism experience.

The continuation of the Rs 15,000 compensation under the Wage Compensation Scheme for pregnant women in tea garden areas will ensure improved maternal care and nutrition, according to TAI officials.

In his first budget presentation, State Finance Minister Jayanta Mallabaruah announced a Rs 3-per-kg subsidy for export-oriented and premium Assam CTC tea, marking a first for the state.

The production subsidy for orthodox and specialty tea will increase from Rs 10 per kg to Rs 15 per kg, with premium Matcha tea now included in the scheme.

To assist small tea growers, the government plans to raise the agricultural income tax exemption threshold from Rs 2.5 lakh to Rs 10 lakh for annual agricultural income.

However, the tax will be reinstated for larger taxpayers starting April 1, 2026, with the additional revenue allocated specifically for the welfare of tea garden communities, Baruah noted.

He further mentioned that the government will continue to support tea growers through the Assam Tea Industries Special Incentives Scheme (ATISIS), along with initiatives to enhance healthcare facilities and promote tea tourism.