Govt committee opposes abolition of toll tax at Lakhanpur

Government committee constituted to examine levy of toll tax has opposed the abolition of the entry tax at Lakhanpur and other entry points of the state saying it will make the local industries in Jammu and Kashmir uncompetitive.

Government on February 10 has ordered constitution of acommittee to look into levy of toll tax after Jammu Chamber of Commerce andIndustries (JCCI) has demanded abolition of the entry tax to the state.However, all other trade and industrial bodies of the state both from Kashmirand Jammu divisions had opposed the abolition.

   

A senior official, who has access to the report submitted bythe committee, said on the condition of the anonymity that all the members ofthe committee, except JCCI, have agreed upon not doing away with the toll.

However, the members of committee as per the report are infavour of abolishing toll tax on petroleum products which fetches Rs149 croreannually to the state exchequer. Kashmir Chamber of Commerce and Industry(KCCI) which is one of the members of the committee has said the move will “provide an immediate relief of Rs 200 crore to the general public of the stateevery year”.

The 18 member committee has director industries Jammu as itschairperson, additional commissioner, state taxes department from both Jammuand Kashmir, directorate of industries Kashmir and representatives of businessbodies both from Kashmir and Jammu are its members.

 “While the membersrepresenting the industry were against abolition of toll tax on goods of massconsumption as the same in no way is going to reduce the prices of suchcommodities. But KCCI and JCCI were for its abolition,” the official said.

As per the report of the committee, stakeholdersrepresenting the industry have said that abolition of toll on 12 commoditiesduring 2018-19 did not have the effect of reduction of prices of suchcommodities. Even KCCI as per the report has said that while abolition of tollon commodities will have no “visible impact on prices of products” but couldbenefit the trader and manufacturing companies.

As per the report, there has been a complete consensus ofall members on abolition of toll on diesel, petrol including Aviation TurbineFuel, coal and coke including steam coke, LPG and Kerosene.

As the committee which has held a series of meetings beforesubmitting its report, several industrialist bodies in both Kashmir and Jammudivisions have opposed revocation of the entry tax arguing “it would provefatal for local industry.” Post-implementation of Goods and Services Tax (GST) which subsumed allother indirect and direct taxes, the state government which was led by PDP-BJPgovernment at the time of implementation of GST, kept in place the toll tax inorder to provide level playing field to the local industry in the state withthe big companies and MNCs, as it is already suffering due to geographicaldisadvantage. 

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