VAT row: Odisha traders to stop import of food grains as talks fail with govt

FAOTA G-Sec says the ban will continue indefinitely until the government withdraws the levy

The talks between the Odisha government and representatives of Federation of All Odisha Traders' Association (FAOTA) failed on Wednesday on withdrawal of VAT on pulses, wheat and wheat products.

Traders are hell bent in their decision to go ahead with stopping of importing of essential food grains to Odisha from April 1. They had threatened to stop the import of essential commodities pulses, edible oil , sugar, rice, wheat and wheat products from other states from April 1 protesting against five per cent value added tax (VAT) imposed on pulses, wheat and wheat products by the state government. As many as 25 states have exempted VAT on pulses, wheat and wheat products.

"On March 26 meeting , the government had agreed to reduce VAT on pulses from the existing five per cent to one per cent. The government had agreed to take a call on wheat and wheat products in today's meeting. Strangely, the government today changed its stance completely and resorted to dilly dallying tactics. We will go ahead with our call on banning of import of all essential food items to the state", said Sudhakra Panda, general secretary , FAOTA.

The ban will continue indefinitely until the government withdraws the levy, he added.

The traders had gone on a two-day stir in December 2014, stopping import of pulses, wheat and wheat products to press for their demand for waiver of VAT. Last year too, the traders had resorted to five-day strike before calling it off with the government forming a committee to examine their demand to lift VAT.

They have been demanding one per cent VAT slab for pulses, wheat and wheat products. This can fetch the state government assured revenue of Rs 60 crore.

Of its consumption of 0.9 million tonne of pulses, Odisha imports an overwhelming majority as it produces only 0.12 million tonne. The turnover of pulses trade is estimated at Rs 6800 crore. Similarly, the state's wheat consumption is 1.2 million tonne and a bulk of it is met through imports.

" The meeting held under the chairmanship of finance minister decided that the next round of discussions on the issue will take place after the ongoing assembly session. We appeal traders to withdraw their decision to stop the import of essential commodities for the greater cause of the consumers", said Sanjay Das Burma, minister for food supplies and consumer welfare department.