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NEW DELHI, June 5

THE Regional Board of All India Manufacturers' Organisation (AIMO) has opposed the levy of the Local Area Development Tax (LADT) being imposed by the Haryana Government.

In a statement issued here, the Executive Secretary of the AIMO Regional Board, Mr Jatinder Nath Joshi, maintained that the 4 per cent LADT ad valorem on the entry of goods into the State is 20 times higher than of the erstwhile octroi.

He said the imposition of this local area tax on entry of goods into the State, be it raw materials or intermediates, would deal a lethal blow to the State domestic industry at a time when it is reeling under severe recession.

Mr Joshi said the Central Government has a provision under which whenever certain finished goods are sent from Haryana to any other State, no sales tax is payable to the Government of Haryana as the same would have already been paid to the State from where the raw material for the finished goods had been procured. This provision ensured uninterrupted and free flow of goods from one State to another. But for the first time in the country, the Government of Haryana is breaking this tradition, he said and added that apprehensions abound that other States might follow suit and levy local area development tax.

Mr Joshi said that imposition of entry tax on raw material from other States would have a double taxation effect at a time when the industry in the State could ill-afford it.

He urged the Central Government to take steps to discuss the issue with the industry and all the State Governments so that this practice does not spread to other States.

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