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VAT strike spreads

Calcutta, April 24: Protests against value-added tax snowballed today with traders of industrial products announcing a five-day strike beginning tomorrow.

Already, a nine-day strike by the wholesale trade in commodities is into its fifth day with the threat of culminating in a complete shutdown, when retailers will also join in, on April 29.

The Confederation of West Bengal Trade Associations said around 3,000 retail shops, dealing in products like automobile spares, electrical items, hardware, cosmetics, sports goods and paints, would stop working from April 25.

'The manner in which prices of nearly 270 commodities have started spiralling has left a vast majority of traders wondering how VAT would contribute to bringing down prices. It now appears that the government's contention that prices would fall has backfired. The strike is aimed at driving home this point to policy-makers,' said Pawan Khowala, secretary of the confederation.

On Sunday, posters were slapped across parts of central Calcutta to drum up support and later in the evening, meetings were held to convince traders how VAT would hit business.

On the same day, finance minister Asim Dasgupta left for Delhi to hold another round of talks with counterparts from other states tomorrow to address complaints of lack of uniformity in VAT rates.

'According to our information, major variation in VAT rates does not exist except for one or two states,' Dasgupta, who heads the committee leading the implementation of the new tax, told PTI.

A delegation of the Confederation of All-India Traders, which today demanded deferring of VAT on grounds of anomalies and disparities, will met Dasgupta to present their case.

Feroze Ali, president of the Bengal confederation, said the intention behind the strike was to persuade the Union government to review VAT.

'The situation is particularly serious for Bengal where out of 570 items, almost 530 are imported and incur a 4 per cent central sales tax,' he added.

Although VAT should eventually lead to its abolition, central sales tax is going to continue for some time.

The wholesale trade strike has sucked life out of commercial hubs of the city like Posta and Burrabazar and, though there has been no effect yet at the retail level, worries remain about prices as the action enters its closing lap.

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