GUWAHATI, Feb 9 ?The Federation of Industries and Commerce of North Eastern Region (FINER) has submitted a pre-budget memorandum to the State Government demanding rationalisation of the tax structure and widening of the tax net in the State. In the memorandum submitted to the Chief Minister Tarun Gogoi who holds the Finance Portfolio, the Federation suggests that the Sales Tax department in the State should initiate a special drive for registration of all eligible dealers in the State in order to widen the tax net.
The FINER is of the opinion that existing small number of registered dealers in the State suggest that large number of eligible dealers are out of the tax net causing huge loss to the exchequer. ?While rationalisation of tax laws on the one hand will lead to better compliance of tax provisions, widening of tax base/ tax net will result in increased revenue to the exchequer,? the FINER stated.
The FINER requests the State Government to exempt all kinds of inputs including cement and capital goods like plant and machinery from the purview of the Entry Tax in tune with the State?s Industrial Policy. The FINER feels that concessional rate of AGST ( i.e 4%) for sake and supply of goods to Government departments and undertakings needs to be further widened as the amendments have not covered many items produced by local industries like industrial gases, wielding electricals, drugs and medicines, rubber and foam produces.
The FINER states that this will not only discourage the buyers (Government departments and undertakings) to procure these items from outside the State by paying 4 per cent CST at the cost of the State?s exchequer but also will result in boosting State?s revenue by way of 4 % AGST, creating work for the local industries and more job opportunities for the unemployed.
The FINER demands rationalisation of Sales Tax Rates by introducing no tax on Schedule I items, 4% AGST on inputs and raw materials for industries, iron and steel, bitumen and bituminous products, drugs and medicines and other essential goods, and 8 per cent AGST on other items. The FINER has demanded withdrawal of ad hoc additional tax because of its very high rate and continuation of existing concessions to new industries notwithstanding introduction of VAT.
The FINER had taken up the issue of incentives and the VAT with the 12th Finance Commission during the recent visit of the Commission to the State and suggested that State Government should be compensated for loss of revenue owing to continuance of incentives to the industries.