The Vidarbha Taxpayers Association has decided to approach the Chief Justice of India seeking withdrawal of LBT. The decision was arrived at in a meeting that was held on Thursday.
President of the association, JP Sharma told TOI that the decision was unanimous. As per the decision, VTA sent memorandums to President Pranab Mukherjee, Prime Minister Dr Manmohan Singh, Maharashtra governor K Sankaranarayanan, and the state government. Sharma said, “The first report on ‘Goods and Services Tax (GST) in India’, prepared by the empowered committee of state finance ministers in November 2009, had subsumed the following state taxes and levies under GST- VAT / Sales tax, entertainment tax (unless it is levied by the local bodies), luxury tax, taxes on lottery, betting and gambling, state cesses and surcharges and entry tax not in lieu of octroi. This clearly indicates that the state government with an intention to keep octroi out of GST has introduced LBT. The very purpose of bringing single tax system has got defeated by the introduction of LBT.” Tejinder Singh Renu, secretary of VTA, pointed out if VAT rates are increased instead of LBT there will be many advantages.
There will be uniformity through out the state, while LBT lacks parity. “Octroi was better than LBT, as in the former payment had to be made at entry only. However, in LBT whole new system of tax procedure is required. This is equivalent to the VAT. Such new system of taxation will discourage investments in Maharashtra,” he said. In an appeal to the Chief Justice of India, VTA contended that it is a well know and accepted fact that Indians are over burdened with plenty of taxes. Such tax hassles are the main cause behind poor foreign investments and thereby business expansion. “Under such condition, taxpayers are not ready to carry the burden of another tax and its cumbersome compliances. Hence, we seek intervention and request issuance of appropriate directions to the state government,” the memorandum stated.
VTA also appealed to the Central and state government to take into consideration the factual position. The association recommended that LBT should be withdrawn and countered with a marginal increase in the VAT rate. Meanwhile, VTA issued a statement that it wholeheartedly supported the indefinite bandh that has been called from April 22 against LBT. It also requested everyone to join hands in the fight against LBT.