VAT and delayed payments figure in FOSMI's pre-budget memo to WB govt
Updated: Feb 11, 2014 05:29:19pm
Kolkata, Feb 11 (KNN) The Federation of Small and Medium Industries (FOSMI) has submitted a memorandum to West Bengal government on various challenges faced by SMEs in the state, especially with regard to VAT and delayed payments.
The memorandum was submitted to Minister – in – charge of finance, excise, commerce and industries, public enterprises and industrial reconstruction departments, Government of West Bengal, Amit Mitra, seeking his intervention.
“It has been reported that the registered dealers under the West Bengal value added tax Act 2003 have been facing trouble in getting refund of excess input tax credit / excess payment of tax. It may be mentioned that such refund always arises in cases where (a) dealers paying higher rate of tax input on materials but eligible to lower rate tax on outputs (b) in case of dealers whose major part of sales are inter – state sales to registered dealers against prescribed declaration forms enjoying concessional rate of tax but procures inputs from within the state bearing higher rate of tax and (c) export oriented units,” the Memorandum said.
Although these units are eligible to get seventy five per cent of the total claims after filing returns, refund is delayed unnecessarily, said a release by President, Federation of small and medium industries, West Bengal, Biswanath Bhattacharya.
According to the Federation, the present prescribed returns in Form 14 under the Act ask for various particulars to be furnished in various Annexures calling for information - very often not relevant for the dealer concerned.
“It is therefore suggested that the concerned dealer will be asked to furnish the particular annexure relevant for such particular dealer only and not each and every annexure prescribed to be enclosed with the return,” the Memorandum said.
The industry body is of the opinion that in order to encourage use of solar energy and solar power generation, rate of VAT on solar + AC inverters with battery and solar range should be nil.
Further, in most of the states, to protect industries from power crisis, full rate of VAT on sales of diesel generating sets have been fixed @ 5 per cent. It is, therefore, in the interest of local industry and business that rate of tax on sale of diesel generating sets should be fixed @ 5 per cent, it said.
Significantly, rubberised coir mattress is made of coir (coconut skin) and latex rubber. Both are natural products and production of such matters is rural based. However, the item is now taxed @14.5 per cent while the mattress used from PU foam is taxed @ 5 per cent. Not only is the imposition of tax discriminatory, considering the fact that coir mattress is a rural based industry, FOSMI has requested that rate of tax on coir mattress is reduced to 5 per cent.
As regards payment of entry tax it has been reported that many dealers are receiving notices issued by the authorities for payment of entry tax. In this connection FOSMI draws the attention to the fact that the matter lies in a legal dispute before the Division Bench of Calcutta High Court.
“It is, therefore, in the interest of justice no one is pressurized to make payment of disputed entry tax through service of notice,” it said.
Most government departments, local self-governments and public sector under takings, both under central and state governments, delay due payments to suppliers belonging to the MSME Sector.
“These delayed payments often make the small supplier units sick. It is in the interest of survival of such units that the buyer departments / undertakings in the public sector make payments as per schedule,” FOSMI has appealed through the Memorandum. (KNN/ES)
The memorandum was submitted to Minister – in – charge of finance, excise, commerce and industries, public enterprises and industrial reconstruction departments, Government of West Bengal, Amit Mitra, seeking his intervention.
“It has been reported that the registered dealers under the West Bengal value added tax Act 2003 have been facing trouble in getting refund of excess input tax credit / excess payment of tax. It may be mentioned that such refund always arises in cases where (a) dealers paying higher rate of tax input on materials but eligible to lower rate tax on outputs (b) in case of dealers whose major part of sales are inter – state sales to registered dealers against prescribed declaration forms enjoying concessional rate of tax but procures inputs from within the state bearing higher rate of tax and (c) export oriented units,” the Memorandum said.
Although these units are eligible to get seventy five per cent of the total claims after filing returns, refund is delayed unnecessarily, said a release by President, Federation of small and medium industries, West Bengal, Biswanath Bhattacharya.
According to the Federation, the present prescribed returns in Form 14 under the Act ask for various particulars to be furnished in various Annexures calling for information - very often not relevant for the dealer concerned.
“It is therefore suggested that the concerned dealer will be asked to furnish the particular annexure relevant for such particular dealer only and not each and every annexure prescribed to be enclosed with the return,” the Memorandum said.
The industry body is of the opinion that in order to encourage use of solar energy and solar power generation, rate of VAT on solar + AC inverters with battery and solar range should be nil.
Further, in most of the states, to protect industries from power crisis, full rate of VAT on sales of diesel generating sets have been fixed @ 5 per cent. It is, therefore, in the interest of local industry and business that rate of tax on sale of diesel generating sets should be fixed @ 5 per cent, it said.
Significantly, rubberised coir mattress is made of coir (coconut skin) and latex rubber. Both are natural products and production of such matters is rural based. However, the item is now taxed @14.5 per cent while the mattress used from PU foam is taxed @ 5 per cent. Not only is the imposition of tax discriminatory, considering the fact that coir mattress is a rural based industry, FOSMI has requested that rate of tax on coir mattress is reduced to 5 per cent.
As regards payment of entry tax it has been reported that many dealers are receiving notices issued by the authorities for payment of entry tax. In this connection FOSMI draws the attention to the fact that the matter lies in a legal dispute before the Division Bench of Calcutta High Court.
“It is, therefore, in the interest of justice no one is pressurized to make payment of disputed entry tax through service of notice,” it said.
Most government departments, local self-governments and public sector under takings, both under central and state governments, delay due payments to suppliers belonging to the MSME Sector.
“These delayed payments often make the small supplier units sick. It is in the interest of survival of such units that the buyer departments / undertakings in the public sector make payments as per schedule,” FOSMI has appealed through the Memorandum. (KNN/ES)
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