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Traders threaten stir against VAT, entry tax on sugar

Staff Reporter

BERHAMPUR: An essential commodity such as sugar costs more in Orissa than in Andhra Pradesh. As per traders it is due to the imposition of Value Added Tax (VAT) and entry tax on sugar by the State government, while other States have exempted sugar from such taxation.

President of Ganjam Chamber of Commerce C.Ravindranath said traders decided to protest against the decision of the State government by stopping procurement of sugar from June 30. It may be noted that traders were also protesting against imposition of similar taxes on textile goods.

Mr Ravindranath said they had decided to resort to agitation as the State government had not yet taken any concrete decision regarding roll back of the tax imposed on sugar.

At present four per cent VAT was being levied on sugar and one per cent entry tax imposed on it.

“Due to it for every quintal there is a disparity of around Rs 150 in the price of sugar in Orissa and Andhra Pradesh,” Mr Ravindranath said. Price of each kilogram of sugar is Rs. 1.50 to Rs. 2 higher in Berhampur in comparison to prices in places in Andhra Pradesh just 25 km away.

As per him such disparity in tax and price would only encourage unscrupulous traders and loss of revenue for the State government.

In bordering areas of the State there would surely be inflow of sugar from adjoining States into Orissa by these unscrupulous elements to cash on this disparity, he said.

As per the traders this disparity in price and taxation is contrary to the basic motive of VAT which was implemented for uniform taxation and pricing throughout the country.

Consumers in Orissa are no way better off or less burdened by inflation in comparison to their counter parts in other States, they alleged.

Trading community of the State had sent representations to the Chief Minister, the Finance Minister urging for roll back of VAT on sugar and textile products. “If the State government could withdraw VAT on LPG without calling up a Cabinet meeting then why roll back of VAT on sugar and textile materials is awaiting a Cabinet meeting”, Mr Ravindranath said.

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