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KCCI plea against tax hike
Our Bureau
Kochi
,
June 21
The Kerala Chamber of Commerce and Industry (KCCI) has warned that the proposal to enhance rate on tax on certain commodities will affect the existing tax buoyancy due to the implementation of VAT and will consequently adversely affect the business community.
The Chamber President, Mr John K. Paul, said in a statement that a higher rate of tax compared to the neighbouring States would only increase corruption among officials of the department. It would not increase the tax revenue since there would be diversion of trade to other States.
He said that increasing the tax rate without considering the rates in other States is against the fundamental principle of VAT, which envisages uniform law and uniform tax throughout the country.
COUNTER CLAIM
The Chamber President said that the claim by the Government and officials of the Commercial Taxes Department on the substantial decrease in tax income after the implementation of VAT is misleading and can be construed as an allegation against the business community.
While the tax collection during 2004-05 was Rs 6,797.4 crore, it is Rs 6,980.3 crore in 2005-06. The tax collection figure of 2005-06 has been shown without considering the amount of tax credit allowed by the Government. Mr Paul pointed out that the collection during April is Rs 393.97 crore, which is three times the collection of April last year.
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