VAT RATE INCREASE
Our Staff Reporter
Guwahati, July 7: Faced with an uproar over the government’s decision to hike VAT on as many as 127 items, Fince minister Himanta Biswa Sarma today sought to assuage the public anger, claiming it would not have any impact on the common man.
Pointing to the critical fincial position of the State, Sarma said that the State government is now focusing on a dymic tax policy to cope with the situation.
“We have already published a White Paper detailing the liabilities on the new government. Though we then thought the burden was around Rs 10,000 crore, we will have to re-assess the situation as we apprehend it could be to the tune of Rs 12,000 crore. We will publish a revised White Paper again during the budget session,” he said.
Sarma said the period till March 31 next is “critical” and after overcoming this phase, the State government will reconsider the decisions taken to hike the VAT rates.
“If we don’t levy some taxes, how can we approach Delhi for help? We have to show we are doing our bit (to raise resources). So far the Central government has been kind enough and that is why we have maged to pay the employees’ salaries,” he said.
Sarma said task forces have been formed in every district to ensure that traders do not raise the prices of commodities in the aftermath of the government’s decision.
The Fince minister also said that the government would cut taxes on some commodities in the upcoming State budget. He also said that the State’s Seventh Pay Commission award is expected to be implemented from April 1 next year, which would put an additiol burden of Rs 4,500 crore on the government.
Regarding petrol prices, Sarma said the State is following a dymic policy and the additiol tax will be withdrawn if intertiol prices go up.
He also said if the IOC hikes LPG rates after the government’s decision to withdraw the partial exemption granted to the company, the government may consider transferring the subsidy directly to the customers’ bank accounts.
Sarma also indicated that the government may revoke the subsidy given to APDCL.
The State government had on June 27 increased the VAT on as many as 127 items from 5 to 6 percent. The government has withdrawn partial exemption granted to oil companies on sale of LPG (cooking gas) for domestic use within Assam, which will result in increase in prices of gas cylinders by Rs 14 each. The price of petrol will increase by 76 paise and diesel by Rs 1.67 per litre.
Sarma said the hike in VAT rates would yield an additiol revenue of Rs 700 crore.
He also took at dig at former Chief Minister Tarun Gogoi, saying the previous government had imposed 3 percent tax on as many as 2,000 items during 2013. “Before criticizing us, he needs to change his mindset,” Sarma added.