Pre-budget memorandum submitted to Finance Minister
Trade bodies in the region have called upon the State Government to scrap the 5 per cent tax levied on edible oil.
The State government on July 11 decided to reduce the exemption of the turnover limit for edible oils from Rs 500 crore to Rs 5 crore citing the need to mobilise additional resources to adhere to the fiscal norms and tackle the huge debt of over Rs.1 lakh crore left by the earlier government.
Office-bearers of various trade bodies took part in the pre-Budget meeting presided over by Finance Minister O. Pannerselvam and Commercial Taxes Minister Agri S.S. Krishnamoorthy in Chennai on Monday.
The Tamil Nadu Chamber of Commerce and Industry has requested the Chief Minister Jayalalithaa to withdraw this levy as it would only result in price escalation and tax evasion.
Already reeling from increases in prices of fuel and LPG cylinders, the public would not be able to withstand the steep hike in prices of commodities that would come from increases in tax rates.
A chamber delegation led by president N. Jegatheesan and senior president S. Rethinavelu attended the meeting and put forth their views.
Wheat, which was next only to rice in its use by the people of Tamil Nadu, should be exempted from tax and the tax rates on wheat products should be reduced from 5 to 2 per cent. Commodities not specified in any of the schedules of Tamil Nadu value added tax (VAT) Act be taxed only at 5 per cent instead of 14.5 per cent.
The chamber also demanded that rate of tax on iron grills be reduced from 14.5 per cent to 5 per cent to provide relief to the production units. Dealers and small manufacturers with annual turnovers less than Rs.10 lakh and Rs.5 lakh respectively should be allowed to collect and remit tax at VAT rates. The dealers should be allowed to raise bills' invoices ‘inclusive of tax.' The chamber also called for banning online trading of essential food commodities to contain their prices. A subsidy of Rs.5 a unit should be granted to small and medium industries using diesel generators.
Food grain merchants
The Tamil Nadu Foodgrains Merchants Association has urged the State Government to review the tax exemption limit on edible oil. This reduction to Rs. 5 crore from Rs. 500 crore had affected small manufacturers heavily.
A delegation from the association led by president S.P. Jeyapragasam attended the meeting. The association called for the revival of Samadhan Scheme, a One Time Settlement scheme introduced by Ms. Jayalalithaa during her earlier tenure for expeditious resolution of TNGST cases.
Mr. Jeyapragasam also called for the establishment of a monitoring committee comprising of traders to act as a bridge between the business community and the Government. The association expressed happiness over the State Government's decision to increase 20 per cent revenues through VAT collection during the first quarter of this fiscal.