More goods under tax limit
MEMBERS OF the Tax Bar Association expressed their concern over the government move to bring more goods under the tax limits and increasing tax rate on several consumer goods.
Speaking at a seminar, the senior vice president of the association, Santosh Gupta said the government has been trying to compensate the state exchequer by bringing more goods under the tax limits and by raising the existing rate of taxes.
He said that the state exchequer has incurred heavy financial loss due to ban on the sale of wine, which forced the government to propose tax on the purchase of the goods. But, gradually the government has extended the sphere of tax realisation. At present, the tax was being charged on contracts, hired goods, higher purchases and on the installments of higher purchases. Besides, there was a long list of taxed goods and the government was still exploring the possibilities of goods bringing under the tax net.
Gupta said the heavy taxation policy of the government and complexities with regard to tax assessment and tax realisation has awfully discouraged the traders of the State and they were trying to move out of the State to other states, which had relaxed the tax structure. Since Uttaranchal Government has offered lucrative offers to the entrepreneurs, they were shifting towards that State.
Besides, the non-implementation of the Value Added Tax (VAT) in the State has also perturbed the traders and the entrepreneurs and they felt that in absence of the VAT their trade prospects would be affected, he added.
Gupta informed that under the present tax policy, the manufacturers were given exemption up to Rs 2 lakh per annum on the sales while for traders the exemption was up to Rs 3 lakh per annum and they were also not required to register themselves. He, however, said that if a trader imported goods from outside the State for sale or to use it for manufacturing would not be entitled to avail tax exemption if he sells the manufactured goods.
During the seminar, the participants put several pertinent questions about the tax assessment and tax realisation, which were responded by the tax experts.