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In a state like Bihar where every next crossing or signal got a samosa-kachauri dukan without any licence, it seems illogical to target a big revenue from a few ‘luxury’ restaurants in this segment. We don't know where the government is heading with this call, but one thing is clear government is trying to divert media attention while development issues are lagging behind. I came through an interesting story at firstpost http://bit.ly/1l91shZ reveals how this govt. is working on development issues.
Money will not come from heaven, reacts Nitish Kumar on Saturday when a group of cloth traders handed him their demand to roll back the newly imposed tax on cloth. It is well known that the decision to charge more than a dozen items of aam-admi has been taxed or the tax increased on them, after the government anticipated a shortfall in revenue because of the ban on liquor from April 1.
Bihar’s well known Industrialist Satyajit Singh says chief minister commits nischay without evaluating resources. At the same time the non-plan expenditure has swelled to a record 59.23 thousand crores. Bihar government must control wasteful non plan expenditure first before commenting that money will not come from heaven. Satyajit Singh is very upset with government tax (ing) policies. He is afraid that the financial choreography by Nitish will lead the state in the great financial mess. The fate of about 1 million small businessmen associated with textile industry has been left in the lurch as State government imposed VAT of 5% on premium segments (above Rs. 2000 or Rs. 500/meter) clothes, Sarees and all dress materials. It is for the first time in any state that textile been adhered to VAT. Furthermore, the readymade garments now attract an entry fee of 5% in addition to VAT.
Ranjeet Singh, Secretary, Bihar Textile Chamber of Commerce argues "if shops in Patna will sell costlier people will go to Banaras, Kolkatta or Delhi for their Shaadi & Lagan". He also said Bihar would become the first state to collect 5% entry tax on the fabrics being imported from other parts of the country. He said over 1 lakh traders participated in the 48 hours band on 21st and 22nd January and on 27 of this month we will meet with the Bihar Chamber of Commerce and Industry to discuss further strategy.
Bihar Garment Manufacturer and Dealer Association president Mukesh Jain said nowhere in the country such taxes are imposed on garment business. Shaadi and Lagan contribute to 75-80 percent of overall annual sell. And premium clothing, Benarasi sarees etc is in huge demand for these purposes. If end customer will bring it themselves government won't get a penny of revenue. This seems to be politically motivated, he lambasted.
Amit Sinha is a bilingual columnist. He can be contacted at facebook.amit
