From April 1, consumers will have to pay four per cent additional Value Added Tax (VAT) when they buy grains like rice, wheat and pulses. As a mark of protest, traders kept the market shut on Tuesday and took a delegation to Mantralaya.
Any additional tax will be passed on to the consumers. At a time when the prices of commodities are soaring, it will be difficult to hike prices again because of tax, said Deepak Bora, president of the Pune Merchants Chamber.
On Tuesday, trading for wheat, rice, all other grains and pulses was closed owing to the strike. It is learned that most of the shop owners in the city, however, had already stocked up grains.
If 100 kg of rice costs Rs 5,000, then traders say that they will have to pay an additional sum of Rs 200 for each bag of rice if the VAT is increased.
At Rs 50 per kg, consumers may have to pay Rs 2 per kg in excess once the VAT is implemented.
Though VAT has been in existence since 2005, they have always exempted essential comnmodities from the tax bracket, Bora said.
Traders have not been paying any tax on grains since two years, when the Pune Municipal Corporation eliminated the octroi.
We want them to maintain that status quo, he said.
A Pune delegation went to Mumbai to meet the MLA, Bora said. Around 40 traders met several leaders on Tuesday. We are hoping a favourable decision in the present assembly session itself. We are asking the assembly to remove essential commodities from the VAT bracket, Bora said.