Cabinet sub-com to study uniform tax policy

| 17 January 2000 17:51 IST

Goa is already suffering from less amount of grants being received from the centre. Still the tourist state has decided not to implement the uniform sales tax policy as per the categorised minimum floor rate decided by the states at national level.

"It does not matter if the centre punishes us by reducing our grants further. But I cannot do anything just because the centre is telling us. We have to see whether it benefits us", says chief minister Francisco Sardinha.

He had postponed the decision to implement it from 15 January, before making a Delhi trip last weekend. After holding a cabinet meeting today, he has now announced formation of a sub-committee headed by deputy chief minister Dayanand Narvekar. The ministers for industry, power and tourism would be its members.

Though the report would be placed before a special cabinet meeting within 10 days after studying item-wise proposed tax structure, it appears that its actual implementation may not begin during the current financial year.

"We have to then send our proposal to the centre and then wait for their response to it", says Sardinha. He is contemplating possibility of many items suggested in certain categories to change sides as Goa is one of the few states which does not manufacture but only sells, by charging additional four per cent central sales tax on imports.

The central proposal is divided into four categories, beginning from 25 items in zero per cent category, only four in one per cent slab, 41 in four per cent slab, 73 in eight per cent, 57 in 12 per cent and five in 20 per cent. All other unmentioned items automatically attract eight per cent.

"I want revenue in reality and not simply on the paper", states Sardinha, while pointing out that Goa has to import raw material and even export the finished products in search of market. The state thus may not benefit much with the uniform tax policy.

Sardinha claims that he has already conveyed to union finance minister Yeshwant Sinha that the uniform sales tax policy is not in the interest of Goa. "The whole Goan economy would collapse if we implement it", he fears.

Goa is one of the few states like Delhi having lowest tax structure due to its limited market, failing which it is feared that the trend of travelling across Karnataka or Maharashtra for marketing would be the easy option for any Goan, considering its small size. The local market would then be totally upset.

Sardinha appears to have decided to fight its case as he has no hopes of the central BJP leaders helping him simply because the local BJP are partners in his coalition government. "Money has no party. But even the local BJP shares our view", he adds.

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