Entry tax on items to plug revenue loss to Goa: Manohar Parrikar
November, 08th 2012
Chief minister Manohar Parrikar on Wednesday allayed fears that the recent move of the government of levying entry tax on certain items will not affect the common man.
Briefing the media, Parrikar said that there should be no confusion between VAT and entry tax and that the government has only brought in certain items under entry tax, not VAT. He clarified that entry tax is there to protect the state from losing revenue when items are imported into the state from outside and the state does not get tax due to various reasons.
Parrikar said, "If you import material from a foreign country, the local government loses the tax because there is no sale taking place in Goa. Because of certain reasons, there were some areas which were left out of this entry tax either by error or on purpose. We are only plugging it".
Parrikar argued that the items which have been brought under the entry tax are in no way connected to the common man. "One of the entry taxes is on barges and vessels. During the last five years at least 10 big vessels worth about 800 crore have been imported into the state waters without the payment of a rupee to the state government," Parrikar said.
He said that when he realized that there was a loophole by which the state revenue was leaking, he introduced the same amount of value of VAT as an entry tax on boats which will be imported to the state. "Probably in the next eight months, we will get revenues of 30 crore to 40 crore. What is wrong in that? Where does the common man buy boats?" the chief minister asked.
He also reiterated that aluminum panels and aluminum cladding which have been brought under the entry tax are used only on commercial buildings and not by the common man.
The chief minister cited another example where the state was losing revenue. He said that last year, timber was put under the 5% tax bracket and plywood which is 12.5% is being imported and sold as timber. "We are losing revenues. Actually, we should investigate how timber suddenly became 5%. We are doing that exercise and in the next budget we will have a foolproof list where misuse of VAT will be stopped," Parrikar said.