The Hindu : New Delhi News : Govt. comes under intense pressure

Online edition of India's National Newspaper
Wednesday, Jul 28, 2004

New Delhi

New Delhi

Govt. comes under intense pressure

By Our Staff Reporter

NEW DELHI, JULY 27. With the Delhi Assembly scheduled to pass the budget on July 29, the Delhi Government has come under tremendous pressure from various lobbies including the automobile sector and the petroleum dealers to roll back the hike in sales tax on diesel and also not go ahead with the 2 per cent cess on private diesel vehicles.

Even as the Government's concern for environment has come in for praise by environmentalists, petroleum dealers across the Capital have decided to go on one-day strike tomorrow to protest the hike. However, the Chief Minister, Sheila Dikshit and the Finance Minister, A.K. Walia, are not in a mood to roll back this historic measure that would go a long way in fighting for the cause of environment. "We will consider whatever is reasonable. We will not work under any pressure and not succumb to lobbies that have no concern for environment. The sales tax on diesel was probably the lowest in Delhi and in southern States it exceeds 30 per cent. We cannot afford to lose out on revenue and also violate the uniform floor rates," Ms. Dikshit remarked. At the same time, she said the Government was firm on the 2 per cent additional tax on diesel vehicles and said this was part of the second-generation reforms in the fight against pollution in Delhi. The Capital's air has improved tremendously during the past five years but we cannot afford to sit back and more such actions need to be taken.

Dr. Walia was equally forceful and said that efforts had been made to give a best deal to all sections. The budget, he said, highlighted the concern of the Government in protecting Delhi's air and keep up the fight against pollution. What has baffled the Delhi Government is the decision by the petrol pump owners to go on strike, as the issue has nothing to do with their commission or earnings. Officials are of the view that the strike is being used as a tool to exert pressure on the Delhi Government and force it to roll back this measure. The Government has also outrightly rejected the plea of the paper merchants association to roll back the hike from four to eight per cent sales tax. The Government had lowered the sales tax on paper from eight to four per cent two years ago with the promise from the trade that the revenue would double. However, the revenue has fallen by almost fifty per cent and the trade refuses to take the blame for it forcing the Government to go in for 8 per cent rate.

As for the readymade garments, officials said that adequate care had been taken to ensure that the middle class and poor sections are hit by imposition of sales tax. Garments above Rs. 1,000 have been brought under the sales tax net as anybody wearing a shirt or a trouser of more than Rs. 1,000 can afford to pay some more tax to the Government.

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