Punjab small scale sector registers growth in production
Updated: Jan 28, 2014 01:21:05pm
Ludhiana, Jan 28 (KNN) The production of small scale sector in Punjab has registered an increase of Rs 2,971.24 crore year on year basis and stood at Rs 62,971.24 crore during 2012-13.
The record production was achieved due to increase in production of various verticals including eatable goods, clothes, sports goods, auto parts, drugs and spare parts, a media report quoting Punjab Industry minister Madan Mohan Mittal said.
The industrial associations have been demanding special industrial package to Punjab to boost production.
Recently, Punjab announced reduction in value added tax (VAT) on cigarettes, iron and steel products and introduced a "social security scheme for business community" to give insurance cover to businessmen in the state.
However, industry representatives in Punjab have been objecting the move of computation of VAT on the basis of energy consumption, after the state government gave relief to Mandi-Gobindgarh based iron and steel industry.
Thereafter, many units in Mandi-Gobindgarh were closed because of high rates of VAT and power.
In an effort to revive secondary steel in Mandi Gobindgarh, the Punjab Cabinet had brought down VAT from 4.50 per cent (plus 10 per cent surcharge) to 2 per cent (plus 10 per cent surcharge) on iron and steel items.
It had also decided to reduce advance tax on finished goods to 2.50 per cent. This move was expected to cost Rs 200 crore to state exchequer.
The industry representatives are saying that if the state government implements this new proposal, then the industry will be forced to shut down units.
However, Punjab Excise and Taxation department emphasized that linking VAT calculation with electricity consumption would bring transparency in tax calculation and would also keep a check on tax evasion by unscrupulous steel makers.
Industry is concerned that the new system of VAT calculation could involve heavy outflow of taxes into state’s fund.
Meanwhile, many NGOs have criticised the Punjab government's recent decision to roll back taxes on cigarettes from 55 to 22 per cent. They are saying that instead of decreasing the VAT, strict actions should be taken to tackle the issue of smuggling due to high VAT. (KNN Bureau)
The record production was achieved due to increase in production of various verticals including eatable goods, clothes, sports goods, auto parts, drugs and spare parts, a media report quoting Punjab Industry minister Madan Mohan Mittal said.
The industrial associations have been demanding special industrial package to Punjab to boost production.
Recently, Punjab announced reduction in value added tax (VAT) on cigarettes, iron and steel products and introduced a "social security scheme for business community" to give insurance cover to businessmen in the state.
However, industry representatives in Punjab have been objecting the move of computation of VAT on the basis of energy consumption, after the state government gave relief to Mandi-Gobindgarh based iron and steel industry.
Thereafter, many units in Mandi-Gobindgarh were closed because of high rates of VAT and power.
In an effort to revive secondary steel in Mandi Gobindgarh, the Punjab Cabinet had brought down VAT from 4.50 per cent (plus 10 per cent surcharge) to 2 per cent (plus 10 per cent surcharge) on iron and steel items.
It had also decided to reduce advance tax on finished goods to 2.50 per cent. This move was expected to cost Rs 200 crore to state exchequer.
The industry representatives are saying that if the state government implements this new proposal, then the industry will be forced to shut down units.
However, Punjab Excise and Taxation department emphasized that linking VAT calculation with electricity consumption would bring transparency in tax calculation and would also keep a check on tax evasion by unscrupulous steel makers.
Industry is concerned that the new system of VAT calculation could involve heavy outflow of taxes into state’s fund.
Meanwhile, many NGOs have criticised the Punjab government's recent decision to roll back taxes on cigarettes from 55 to 22 per cent. They are saying that instead of decreasing the VAT, strict actions should be taken to tackle the issue of smuggling due to high VAT. (KNN Bureau)
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