Punjab Cabinet gives approval for creating Municipal Fund

Chandigarh, Aug 10 (UNI) The Punjab Cabinet today approved the promulgation of an ordinance for enacting a legislation diverting 10 percent of VAT revenue to Urban Local Bodies (ULBs) and for establishment of Punjab Municipal Fund.

This fund would be subject to minimum limit of Rs 550 crore per annum. The establishment of this fund is aimed at compensating the local bodies after the abolition of octroi from September 1.

This decision was taken in a meeting of the Council of Ministers held here under the chairmanship of Chief Minister Capt Amarinder Singh.

The Cabinet had in a meeting last month given its nod to abolish octroi from September 1. The abolition of octroi was a long standing demand of the states traders and was also a commitment which the Congress party made made in its manifesto in the last assembly elections.

Meanwhile Capt Singh appealed to the traders and manufacturers that the benefit of Rs 550 crore as result of abolition of octroi from September should be passed onto the consumers. Besides facilitating free movement of goods vehicles with the removal of octroi posts, the abolition of octroi should result in the reduction of prices of consumer goods, he added.

The cabinet also approved to exempt ''Papad'' and Wadiyans'' from the payment of VAT.

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