Published On : Thu, Nov 27th, 2014

Is leader’s verbal assurance enough for civic officials not to conduct raids on LBT evaders?


As the traders in the city are in ‘let go’ mood post the announcement of Union Road Transport Minister Nitin Gadkari to abolish LBT within a month, the civic authorities are in no mood to relent and let go, till the tax vanishes completely from the book of law. However the traders are taking Gadkari’s word as ultimate and stopped following LBT norms. Instead a group of traders have met in the city in which they blamed State Government for backing on its promise of removing LBT.

On one hand the traders are opposing raids and crack down on their establishments for evading LBT, the authorities including Mayor Praveen Datke are of the view that no existing law can prevent these officers to take action against the erring traders as the LBT is yet to go.

The traders have also questioned if the authorities in NMC do not have a trust in their leader’s verbal assurance. In the last six months, municipal authorities had swooped on more than 600 establishments on the pretext that they (municipal authorities) were implementing the directions of the State government.

Under such a situation, a question arises whether an assurance from leader of central statute is enough to block raiding officials. The series of raids are going uninterrupted – which has given rise to discontent among the traders.

As per the set norms, a statement issued by the national leader of the party is considered as a guideline for the party policy.  The party bosses at the lower level are expected to act in accordance with this spoken guideline.

Earlier, traders had mooted a proposal to levy an additional surcharge of 1 per cent on VAT. However, the then DF government led by Congress-NCP differed with the traders on the ground that this additional surcharge would unnecessarily burn a deep hole into the pockets of rural population living within the jurisdiction of gram panchayat and panchayat samities.

According to a report prepared by a traders’ committee, State government should pay around Rs 13,500 crore to various municipal corporations.

However, today the alternative of multi-point turnover tax has come forward.

Under this new regime, a 0.25 per cent to 0.50 per cent tax would be levied on the turnover of every trader. Traders, would also be required to furnish online details of their turnover to the govenment on a monthly basis .

The tax on every trader would be imposed on the basis of this turnover.

This new system would place certain limitations on the transactions of a particular establishment. This would, however, ensure steady flow of income to the State government and on the basis of the category of a municipal corporation, the latter would get a fixed share in the revenue.