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GCCI wants increase in professional tax limit

The Gujarat Chamber of Commerce & Industry has sent a wish list to state finance minister, Vaju Vala.

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A few years back, the Gujarat government increased the professional tax, against abolishment of octroi. But trade body GCCI believes that just as the Centre keeps on increasing limits and slabs in income tax, the state government too should also start increasing limits on professional tax.

The Gujarat Chamber of Commerce & Industry (GCCI) has sent a wish list to state finance minister, Vaju Vala. The president of GCCI, Chintan Parikh, is expecting that on Friday, when the minister will announce the state budget, he may consider the wish list and expectations given by the chamber.

According to Parikh, today any salaried person, from peon to manager, is supposed to pay professional tax. "But the peon, who is drawing around Rs6,000 per month, should be exempted from the tax. In our wish list, we have urged the authorities to increase the professional tax up to a certain extent so that not only the lower income group, but also the middle income group benefits," said Parikh and added that at the time of rising inflation this will help both lower and middle income group people.

Secondly, GCCI has also urged the state finance minister to reduce stamp duty. "We think that stamp duty should be brought down," said Parikh. According to industry experts, the stamp duty levied in Gujarat is 6% which is among the highest in the country. If stamp duty is brought down, the builders may stop demanding cash component on selling of houses.

In the 40-page long wish list of GCCI, Parikh has also said that one of the important points in it is to withdraw the tax on inter-state transaction. Right now, state government retains 2% from the input tax credit of tax paid on the inter-state goods transfer. "Industry cannot afford this. Probably Gujarat is the only state in the country where this kind of tax is levied and this tax is pinching the industry. So we have urged the state government to increase the input tax credit to 2%," said Parikh.

When asked whether there is need of reduction in VAT rate, Parikh said that it is true that compared to other states, Gujarat's VAT rate is among the highest. "But, compared to other states, even the development outlay is higher. People of Gujarat may not like poor roads and inconsistent power supply. Hence for this, state is levying bit higher. But, I think that compared to other states, Gujarat should be competitive," said Parikh.

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