Maharashtra trade body warns of indefinite trade bandh

Mumbai: Traders body Federation of Association of Maharashtra (FAM) on Monday said it will go ahead with its indefinite Maharashtra bandh plan if the state government did not resolve the issue of local body tax (LBT) by next week.

The traders' body had earlier said it will go on such a strike against the state government's decision to replace octroi with local body tax.

FAM, representing 750 trade associations of Maharashtra, at its meeting in Mumbai on Monday strongly opposed LBT and octroi.

"We may go for possible indefinite trade bandh in Maharashtra, if the state government fails to resolve the issues confronting trading community," FAM President Mohan Gurnani said.

FAM action committee is planning a trade bandh across Maharashtra for which a decision will be announced during the next public meeting, likely to be held in about a week's time, Mr Gurnani said.

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Maharashtra government had already imposed LBT in lieu of octroi from April 1 this year across the state and from October 1 in Mumbai city. There is a strong resentment against LBT among the trading community.

The LBT had come into effect from April 1 in Kolhapur, Sholapur, Vasai-Virar Municipal areas. Traders in these areas are forced to get registration number and served with the three-day notice to pay LBT on monthly turnover of the sales of goods in local area along with interest and late fee.

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The traders have been threatened with penal action, including two years' imprisonment if they fail to pay the dues.

Traders across the state are opposing the present form of LBT, saying it is totally at variance with the draft submitted by the FAM and other chamber of commerce.

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It appealed to the state government to keep the implementation of LBT in abeyance till further discussion with the trading community to arrive at a consensus.

FAM Executive President Surendra T Savai stated that LBT is one of the causes for present inflation and therefore, states should avoid levying such local taxes.

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He said this provision (only in Maharashtra state) will push up prices further and lead to corruption and harassment of traders.

Maharashtra traders have already started shifting to the neighbouring state where government policies are pro-traders, he said.

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There are a number of issues like VAT refunds, other problems related to VAT, Food Safety Act, seizure of food grains, FDI in retail trade, Shop & Establishment Act, which are still unresolved, Mr Savai added.