The striking textile traders in Andhra Pradesh have slammed the State Government for refusing to withdraw the 5 per cent valued added tax (VAT) on textiles and taking tough stand on the issue.

The traders, who have launched an eight-day bandh since January 23 against levy of VAT, have termed ‘unfortunate' the reported statement of the Chief Minister, Mr N. Kiran Kumar Reddy, that the Government would not revoke the tax.

“We are sorry to say that the Chief Minister is totally misguided by bureaucrats in the Finance and Commercial Taxes Departments on this issue. All other political parties including CPI and CPM, which generally keep distance from traders, have supported our demand for removal of VAT,” Mr Omprakash Tibrewala, President of Hyderabad Cloth Merchants' Association, said.

Emulate Tamil Nadu

He cited the example of Tamil Nadu where the Chief Minister, Ms Jayalalithaa, had dropped VAT on textiles within two days of its imposition.

“Instead, they increased VAT on tobacco by 4 per cent. If the Andhra Pradesh Government is concerned about loss of revenues of Rs 1,000 crore, they should consider following the Tamil Nadu example and impose more VAT on tobacco and luxury items,” he said.

“More than the VAT, traders are scared of corruption, harassment and losing business to neighbouring States,” Mr Tibrewala, past President of Federation of Andhra Pradesh Chambers of Commerce and Industry (FAPCCI), said here in a statement on Friday.

While asking the Chief Minister to revoke the tax, he requested him to invite representatives of trade for a dialogue to end the row.

Meanwhile, Mr Y.S. Jagan Mohan Reddy, President of YSR Congress Party, also joined other Opposition parties to demand withdrawal of VAT on textiles. After holding a dharna to press for the demand, he addressed a public meeting at Narsaraopet in Guntur district. “If our party comes to power, I will withdraw the tax,” he said.

> kurmanath@thehindu.co.in

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