The imposition of Value Added Tax on textile traders found its echo in the State Cabinet meeting on Monday when it caused heated exchanges between Ministers who were supportive of levy of VAT and those who wanted its withdrawal on the ground that it would ultimately hit the common man, the Congress vote bank.

The development follows a recent request by Cooperation Minister Kasu Venkatakrishna Reddy who wanted Chief Minister N. Kiran Kumar Reddy to consider lifting of VAT at least in a phased manner.

Labour Minister Danam Nagender raised the issue seeking withdrawal of the tax on the ground that the traders would devise ways to evade the tax or pass the burden to customers. Primary Education Minister S. Sailajanath, however, objected to the request, saying that the government should not be seen as favouring traders, a well-to-do section.

A couple of Ministers who supported Mr. Nagender are understood to have opined that imposition of VAT would, in turn, lead to hike in prices of textiles as the traders would pass the burden to customers, the poor and lower middle class sections in particular. This would not augur well for the party, they reportedly said.

The Chief Minister informed his colleagues about the conduct of the budget session of the Assembly tentatively from February 13. Accordingly, Finance Minister Anam Ramnarayan Reddy would present the budget, a people-oriented one, on February 17 and the Ministers should be prepared to handle the Opposition effectively on various issues.

Some Ministers are learnt to have expressed concern over the criticism by the Opposition parties, the TDP and the YSR Congress in particular, about the delay in the conduct of elections to local bodies. Mr. Kiran Kumar Reddy, however, is said to have briefed them about the efforts under way to hold elections to cooperative bodies in April which would be followed by polls to urban local bodies by the same month-end. This would be followed by elections to panchayat raj institutions.