'Entry tax totally irrational'

Manvinder Singh / TNN / Nov 24, 2007, 01:36 IST

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The decision of the Akali-BJP government to impose an entry tax on certain items has not gone down well with industrialists in Punjab.

JALANDHAR: The decision of the Akali-BJP government to impose an entry tax on certain items has not gone down well with industrialists in Punjab. According to them, it comes as a major blow to the already dying industrial units in the state.
Gursharan Singh, a leading industrialist of the city and president of Jalandhar Industrial and Traders Association, said due to the decision prices of raw materials has already increased by about 5% because of which rates of finished goods would also increase.
“Imposition of this tax would make industrialists of the state totally bankrupt,” rued Gursharan.
Chairman of Sports Forum Jalandhar and BJP leader Ravinder Dheer alleged that the government has been giving step-motherly treatment to the industrial sector. Claiming that the newly imposed tax is irrational, Dheer said: “The government says that the tax is adjustable, what’s the need of imposing it then. New taxes are being imposed on the industry, why can’t they generate additional resources by cutting down on the expenditure of ministers and bureaucrats.”

Expressing similar views, senior vice-president of the Chamber of Small Exporters AK Kohli said the decision would ruin exporters from Punjab, who are already fighting for their survival. “It is only due to such irrational decisions that the percentage of Indian exports in the global market is less than 1 per cent, whereas countries like China contribute more than 40%,” said Kohli.
He added that most of raw material needed for finished goods comes from outside Punjab and if a tax is imposed on it also it is not possible for industrialists to survive.

Kohli claimed that the step would increase tax evasion and unemployment, as most of the industrial units here would shut down under such circumstances.
RK Gandhi, another industrialist, said by imposing entry tax the government has deceived the business community, as during imposition of VAT it was promised that no other tax would be levied.
He said entry tax has not been imposed by any other state in the country.
“The government is giving subsidies to a particular sector by putting the burden on the industrial sector. We will have to either shut down our businesses or migrate to other state if this continues,” said Gandhi.

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