Amit Mitra at Town Hall on Tuesday. Picture by Pradip Sanyal
Calcutta, Feb. 11: Finance minister Amit Mitra today indicated that entry tax would not be rolled back in the budget despite a section of the industry demanding its abolition.
The minister dropped broad hints on this during a two-and-a-half-hour pre-budget discussion with chambers of commerce in Calcutta.
Mitra had introduced 1 per cent entry tax in 2012 on various products, mostly raw materials used in industries. The move had displeased several large companies such as Mitsubishi, Dhunseri Petrochem and Haldia Petrochemicals.
But the finance minister, who conducts such meetings before the budget every year, defended the tax by citing examples of 15 other states that impose the levy.
“While others take 2-4 per cent, our rate is 1 per cent,” Mitra was quoted as saying by one of the delegates who attended the closed-door meeting at Town Hall.
The budget will be placed on February 17.
According to him, Mitra also said taxation at the existing rates was essential as the state had to pay Rs 28,000 crore to the Centre annually on account of interest on loans and debt repayment. The state had collected Rs 1,250 crore through the entry tax in the first year of its introduction.
The chambers requested Mitra to rationalise and simplify tax rules related to VAT and sought more incentives.
“We requested the finance minister to increase VAT if the government wanted to. But then, we should be given more incentives, like in Gujarat,” a chamber member said.
Mitra told the delegates at the meeting: “When we took charge in 2011, our tax revenue collection was Rs 21,000 crore. Thanks to you, we are about to touch Rs 40,000 crore.”
The minister also thanked the business community for showing the way in tax payment, which has helped the government achieve a substantial growth in revenue collection.
The chambers requested Mitra to come up with a trade policy for Bengal along the lines of its plans for industry and textiles. Mitra said the matter would be taken up.
A suggestion was made that the government offer discount on stamp duty to women buying property.
A section of the industry said it was impressed with the way Mitra and his team of bureaucrats, including finance secretary H.K. Dwivedi, conducted the meeting. “They were well-prepared. It was a good interaction,” said Sanjay Agarwal, the president of the MCC Chamber of Commerce.