Industry reacts to proposed 0.5% VAT hike
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The proposed 0.5 per cent hike in Value Added Tax (VAT) has received a sharp reaction from industry which is already under shock after a power tariff hike, online billing notification and proposal of property and professional taxes. Punjab Finance Minister Parminder Singh Dhindsa said the VAT hike proposal will be discussed in the cabinet meeting on August 28.
Reacting to the proposal, office bearers of the United Cycle and Parts Manufacturers Association (UCPMA) held a meeting on Monday and stated that the VAT hike would be in addition to proposed professional and property tax and service tax which is already been imposed.
Gurmeet Singh Kular, president UCPMA, said that the cycle industry was already in crisis. "We purchase raw material on 5.5 per cent VAT and send to other states with 2 per cent CST. Our 3.5 per cent VAT refund are lying at excise and taxation department. If VAT is hiked by 0.5 per cent, our 4 per cent VAT refund will remain with the tax department. The pending VAT refund cases are also a headache," he added.
The president of the Federation of Punjab small scale industries association (FOPSIA) Badish Jindal said, "While neighbouring states pay 4.5 per cent VAT we are already paying 5.5 per cent. The industry has requested Punjab to withdraw the proposed VAT hike and not impose the professional or property tax."