Tired of queuing up at state borders, truckers hope for an early GST
The Goods and Services Tax (GST), billed as India’s most-ambitious tax reform and the legislation for which was tabled in the Rajya Sabha on Wednesday, will subsume a bevy of taxes including this entry tax.business Updated: Aug 04, 2016 00:01 IST
Zakir feels his luck is good. From his truck, the Municipal Corporation of Delhi’s (MCD’s) toll gate at Badarpur Border is visible. This is usually not the case.
“I have waited here for 3-4 hours also. The queue is 2-3 km long,” says Zakir at 12 am on Wednesday., He is transporting 16 tonnes of wheat from Bhopal to Sadar Bazaar in the National Capital.
Over 20,000 truck drivers enter Delhi in a day through 122 checkpoints on its border. At the checkpoints drivers have to pay an entry tax called the octroi, a municipal-level tax.
The Goods and Services Tax (GST), billed as India’s most-ambitious tax reform and the legislation for which was tabled in the Rajya Sabha on Wednesday, will subsume a bevy of taxes including this entry tax.
Vinay Roy, who collects the entry tax at the Badarpur toll point , however feels that the government cannot do away with toll gates altogether. Roy has been on the job for six months and the prospect of losing it does not excite him much.
Though a single tax seems like a good idea to Faridabad resident Dhruv Mohan Jain, he also says: “Without toll gates how do you know who is coming or going out. Yes, the time saved from not exchanging receipts will reduce the waiting period.”
According to a Ministry of Road Transport and Highways (MORTH) study, a typical truck spends nearly 16% of the time at check posts. A truck in India covers an average annual distance of only 85,000 km as compared to 150,000 to 200,000 km in advanced countries.
“With a common rate of GST across India, checking for sales tax at interstate barriers would not be required. Thus, if the waiting time halves, it would theoretically add 8% additional truck capacity due to efficiency,” Nomura, a brokerage and research firm, said in a recent research report.
Zakir, who like the others at the toll plaza has no clue what GST is, says it would be great service to truckers if MCD toll booths vanish. While this may happen in other cities of the country, at least in Delhi, Zakir’s queue is not shortening soon.
The Supreme Court has mandated environment compensation charge or green tax, which commercial vehicles have to pay when entering Delhi. Trucks, after passing the MCD toll, line-up again.
However, Mahesh Sharma, a supervisor with DEP Toll, the company contracted to collect the green tax, says this queuing up of trucks is good for the city.
“If all the trucks are allowed to enter and exit Delhi freely, there would be a traffic chaos inside the city around the times trucks enter,” he says. Commercial vehicles carrying goods can travel in the city at prescribed timings – enter after 11pm and exit before 7am.
But all this is just expectation and speculation. Nothing will change soon at the Badarpur toll gate, or any at any of the 121 checkpoints, till the details of GST– whether to do away with toll gates or if the green levy will also subsumed – are yet to be decided.
Till then, Zakir will have to wait.