The newly-introduced Local Body Tax (LBT) in Maharashtra makes traders pay the civil body for importing goods into the city. It has brought a surge of anger among traders resulting in a strike in Mumbai due to which most shops including kirana stores and chemists have remained shut.
And now with the Maharashtra Chief Minister Prithviraj Chavan saying that LBT is here to stay, traders and other shop owners want to voice their protests against its introduction.
dna's web team decided to showcase the other side to understand why traders are carrying out these protests.
Vishal Javeri, a local trader of Prinz Engineers, Navi Mumbai briefed us:
1) Why are you protesting against LBT?
When Value Added Tax was introduced we were promised by the government that after VAT all other taxes like Octroi would be abolished. Then two years ago, the government decided to increase the VAT by 1-2% stating that the government needed it to cover the amount that was not being collected after Octroi was stopped.
Even after this sudden increment in VAT we co-operated with the Government's decision and happily welcomed the same. But now, the government wants to introduce a new tax named LBT in order to the reduce the pressure of abolishing octroi.
The Municipal Corporation is appointed to keep a check on LBT collection. At a time when the whole world is becoming paperless with LBT, traders, manufacturers and other shopkeepers have to undergo more paperwork and hand over financial statements to the municipal corporation from time to time.
Everyone is aware that the more the number of tax-collecting government departments, the more the corruption. So now, with the introduction of LBT, most traders will end up giving indirect bribe to one more babu.
We don't want to do this paperwork. We had requested the government to increase VAT by 1% which will serve their purpose but this petition was rejected by the municipal corporation.
We later proposed that the municipal corporation should use the documents submitted by us to the Sales Tax Department and collect tax accordingly. But this proposal was again rejected by them.
The trader fraternity wants to make one point clear: We are not against paying tax but against reporting to one more department. We are not afraid to show our financial statements because we have been uploading our statements along with VAT challan. So this totally rules out the argument that claims we do not want to show our financial statements.
As a trader, the government should give us an opportunity to grow rather than tying us up with one more paperwork.
2) Any message you want to give the CM?
Our CM should understand that we are a republican country and the Government is "for the public, by the public, of the public," but it seems he has forgotten it.
Parag Javeri, owner of Parag Worldwide PVT LTD in Kalbadevi, Mumbai, gave us the following views:
1) Should the ordinary citizen be worried about LBT? Why?
Of course! The aam aadmi should be worried. An increment in tax will increase the cost of their lifestyle too. For example: We have seen the variation in pricing of petrol and diesel in various cities, Mumbai prices are higher than Delhi prices because of octroi. After the introduction of LBT almost all the commodities that we buy in Mumbai will become costlier than any other city.
2) What do you think about the CM's latest statement?
With great respect to his position, he seems to not act for the people but against the people. When the masses don’t want LBT, how can he ask everyone opposing it to leave Maharashtra? Such statements may lead to his ouster in the next election. When we say that the government is by the people and for the people then if someone acts against the people, you know what happens to them.
Pradeep Chabaria, another trader in Mumbai says:
This state is known to be a commercial hub because of its commercial activities thanks to the traders. If you do not respect and listen to the trader community then you can be sure that the down fall has started. We are a hard-working community and can start our business in any other place. Today, every other state is providing infrastructure that's as good as Mumbai or even better. All over the world, rules are getting simplified but in Maharashtra (Mahachorrashtra) things are getting complicated.
Satish Jain, owner of Satish Chemist, Elphinstone Road in Mumbai says:
This tax is going to affect the 'aam' public as well as the traders. You (customer) will be asked to pay the tax first and then purchase the item. It should be removed.
Textile trader Mukesh Simaria says:
Just like we paid the Octroi tax, we are ready to pay the local body tax (LBT). The main issue lies with the additional paperwork that is involved with the payment of the tax. Abiding by this new development would mean more hard work, with added expenses of keeping account books and the tedious job of finishing the inside work. If the government is ready to help us by reducing the extra labour, we will comply."
Amul Coop (@Amul_Coop) also gave following response on twitter:
Amul Topical: Protest against introduction of Local Body Tax in Maharashtra twitter.com/Amul_Coop/stat…— Amul.coop (@Amul_Coop) May 9, 2013
The traders have also started a change.org petition and currently have 8,757 supporters.