ST decision stalled, claims Industry but not Govt

Sandesh Prabhudesai
8 October 1999 

The heat between the Congress government and the local industry here appears to be cooling down over the government's unilateral decision to impose half of the sales tax on all the units which were initially exempted from paying it for 15 years.

The industry has withdrawn its bandh scheduled for Friday as the government has agreed to set up a working group to study the proposals of the resource mobilisation while keeping the decision on withdrawals of sales tax exemption in abeyance.

But the confusion still prevails regarding withdrawals of the government notification, which authorises the sales tax authorities to collect half of the fixed amount of sales tax. The authorities maintain silence over the industry's claim that the government has agreed to keep the decision in abeyance.

The government decision was announced by Dattaraj Salgaoncar, president of the Goa Chamber of Commerce and Industry and Parag Joshi, president of the Goa Small Industries Association after having a meeting with chief minister Luizinho Faleiro on Thursday.

But the official statement released in the evening did not speak anything about the government's decision on imposition of 50 per cent sales tax. It mainly announced constitution of the working group, headed by the finance secretary, to examine the proposals of resource mobilisation submitted by both the associations.

The official statement only speaks about Faleiro explaining the meeting "the rationale behind the decision to withdraw sales tax exemption. He said that a note has already been circulated to the media and associations, outlining the state of finance. He pointed out that fiscal deficits are running high and urgent measures have been taken to arrest this."

Confused leaders of both the associations are now planning to meet the chief minister once again to get the matter clarified. "Faleiro might have not announced it because he cannot reverse the earlier decision without consulting the cabinet", feels Joshi.

But sources in the finance department claim that the decision regarding the sales tax exemption would be taken only after the report is prepared by the working group within a month. "In any case the actual collection would begin after one month though notification has already been issued for tax collection", says the official from the department.

Joshi however feels it would require at least three months to collect and compile the data since even the finance department does not have all the required details to prepare the report.

Salgaoncar, the GCCI president, on the other hand is in fact planning to appoint some experts from outside Goa to study the whole issue in depth. "We are equally concerned about the state's financial health", he says.

Though Faleiro firmly believes that it is time for the industry to share the burden to improve Goan economy, the industry does not want to accept it blindly. "It's a complex issue", quips Salgaoncar.

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