No withdrawal of toll tax, J and K finance minister

Srinagar, Aug 1: Rejecting the opposition demand to withdraw toll and additional tax because of the introduction of Value Added Tax (VAT) in the state, Jammu and Kashmir Deputy Chief Minister Muzaffar Hussain Baig said the central sales tax would be ablished in a phased manner by the centre.

Replying to a question tabled by Ajay Sadhotra of National Conference (NC), Mr Baig who is also the finance minister, said the toll tax and additional tax is being collected by the excise department.

He said the entry tax is not applicable on traders and it is being collected from private persons only.

Rejecting the allegation of Mr Sadhotra that despite assurance that all the taxes would be withdrawan after the implementation of VAT, the minister said no such promises was made with the traders.

I do not know if any officer had made such an assurance, he said adding government has not made any such promise during the meeting between him and the traders.

Mr Baig said central tax is being collected by the centre. It has been agreed to withdraw the Centre tax in a phased manner, he said adding it was also in the interest of the states.

'' Suppose any state will go in loss due to introduction of VAT, the Centre will come to its rescue and give the amount lost due to the VAT'', he said adding the centre will withdraw the tax once it is clear the no state is in loss after VAT.

When the members asked about the toll tax, Mr Baig said the tax is being levied under J and K levy of tolls Act SVt. 1958 whereas VAT is levied under J&K VAT Act 2005. He said entry tax is levied on scheduled good meant for personal use or consumption and not on good imported by dealers meant for sale.

The minister said in the light of soaring prices, a number of essential commodites like 'Dals' and food grains have been exempted from VAT as decided by the empowered committee of state financial ministers at the national level.

In reply to a question whether it is also a fact that government had assured the traders to adjust sales tax paid at first point on the stock held by them upto 31.3.2005, and if so whether the said amount ha been adjusted the minister said under VAT and other relevant rules provide for input tax credits on closing stock held by registered dealers on appointed day.

He said some dealers have claimed input tax credit in their return for the year 2005-06 and credit shall provided to eligible dealers in accordance with the stipulation of the said rules.

Mr Baig said section 22(4) provides the refund of excess input tax credit only after the end of the second finncial year. There is no assurance beyond that, he said.

When asked about the differences in VAT charges which is 12.5 per cent in the state and 14 per cet in other states on dry fruits, the finance minister said our state is strictly adhering to the approved VAT rate. The empowered committee is closely monitoring the decisions and is contemplating action against the erring states.

UNI