Industry bodies worried over increase in input cost

Kolkata, Aug 20 (UNI) Industry bodies apprehended that products from West Bengal in the glass, metal, cement and steel sectors among others would become uncompetitive since the state government transfered furnace oil, coal and other fuels to the negative list of value added tax (VAT).

The Conferderation of Indian Industry (CII) and Merchant Chamber of Commerce (MCC) have already made presentations on this before West Bengal Finance minister Ashim Dasgupta and explained that the companies would not get Input Credit Tax Credit (ICTC) after transfer of furnace oil, coal and other fuels to the negative list of VAT from April 2006, thereby increasing cost of production.

The VAT rate on furnace oil is 12.5 per cent and on coal four per cent. Fuel cost of these industries were high and non availability of ICTC would make their products high-cost and uncompetitive in the market, the industry bodies said in their representation.

If the state government did not revisit the provision, the industry would look for alternative energy or resort to inter-state trade which would lead to fall in consumption of furnance oil and coal and decline in VAT revenue to the government, CII Regional Director (East) Sunil Misra said.

The Finance minister has assured that he would look into the matter.

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