Bhubaneswar, Dec 09: All Odisha Traders Association (AOTA) stopped importing wheat products and pulses from other states from today, demanding withdrawal of 5% VAT imposed on these items by the state government.
Protesting against the VAT, the Malgodown in Cuttack city, which is the prime business point of the state, remained closed today.
Yesterday, the traders body had threatened not to trade in the wheat products and pulses in the state.
The traders union has been demanding for the introduction of a unitary tax system on food products in the state instead of VAT, which is exempted in 23 states in the country. The traders have been opposing the VAT on the food products complaining, the system resulted in the rampant black marketing and high price rise of the basic items .
The AOTA had announced its ultimatum to the state government on November 23 for self impose indefinite ban on the import of these products if their demand is not fulfilled.
"We have on several occasions made representations to the government urging it to do away with the tax on pulses and food grains, essential for survival. We have made our representations to the Finance minister, chief secretary, additional chief secretary, Finance and commissioner, commercial taxes in this context on several occasions. No other state has imposed tax on pulses and food grains. Our demand has fallen on deaf ears. Due to the government's apathy we have decided to take the drastic step," said Sudhakar Panda, general secretary of the Association.
Odisha is a major consumer in terms of wheat products and pulses. Out of nearly nine lakh tonnes of these products consumed in the State, it produces only ten per cent of its demand; sources said adding that the annual business turnover of these products crosses Rs 4500 crore.
"The 5 per cent VAT on these products in the State results in price difference of Rs 300 per quintal in comparison to neighbouring states," said a pulses trader, adding the arbitrary VAT imposition has given way to unfair trade practices as a result against a revenue target of Rs 225 cr, the government ends up collecting a meagre Rs 30 crore.
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