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KOLKATA, March 20

LEADING chambers of commerce today expressed serious concern over the re-introduction of entry tax which was abolished earlier, and suggested that it ran counter to the concept of integration of State taxes, which was crucial for rationalisation of State taxes in a value-added tax regime.

Concern has also been expressed over the move to revive the collection of land revenue under the Calcutta Land Revenue Act, for both commercial and non-commercial uses.

According to Mr Vikram Thapar, President of Indian Chamber of Commerce, the chamber has all along been urging for removal of barriers to internal trade and business in the country "and the step to re-introduce entry tax would surely create impediments to free movement of goods''.

He said the step was not in tune with the overall scheme of VAT. He also apprehended that the proposed land tax on industrial land in Kolkata would lead to difficulties for industrial establishments and also affect the State Government's endeavour to attract more industrial investments.

He also expressed concern that the services sector, particularly the entertainment industry was not given any further impetus in the Budget. He, however, welcomed the initiatives in the area of agricultural development and also the move to promote industrial parks. He also commended the State Government for achieving a growth rate of 7.6 per cent in the current year despite the serious financial difficulty faced during the year.

Mr N.R.Goenka, President, Bharat Chamber of Commerce, welcomed the thrust in the Budget on agricultural production, especially production of wheat, pulses and oilseeds by adopting a pro-active plan and bringing an additional one lakh hectares of land under irrigation. Stating that VAT as expected has been introduced in the State without adequate preparation, he felt it should be introduced only after abolition of CST, entry/Octroi duties wherever applicable along with the Additional Excise Duty. He suggested that the tax credit on capital goods in 36 instalments should be reconsidered and allowed on the lines of Central Excise, that is, 50 per cent in the same year and balance 50 per cent in the next year.

Mr Sunil Kanoria, President of Merchants Chamber of Commerce, pointed out that while the Finance Minister has announced that Additional Excise Duty items would be taxed at 4 per cent as soon as the Bill is passed by Parliament, he has not indicated any timeframe for phasing out CST, which was incompatible with VAT.

Suggesting that AED items should not be brought under the VAT scheme at the initial stage, he said while VAT was supposed to lower the tax load on commodities, the general rate of 12.5 per cent, coupled with the entry tax and CST will in fact significantly raise the tax burden on commodities, and therefore on common people.

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