New Delhi If Central and state taxes and generous subsidies coexist in India’s fuel sector, the food sector is no different.

Various state-level taxes on grain procurement inflate the Centre’s food subsidy bill — a major component of its revenue expenditure — by almost 14 per cent, finds a Financial Express analysis. Besides, private traders in high-tax states like Punjab and Haryana stop buying grain, to the detriment of farmers. Worse, tax proceeds are seldom used in the food and farm sectors and get diverted to other programmes.