Despite the negative impact of the economic downturn on the state’s economy, the collection of commercial taxes in Orissa surged by 14.04 percent during the last fiscal compared to 2007-08.
The total collections were Rs 5522.05 crore in 2008-09 compared to Rs 4842.14 crore in 2007-08. Sources said, over 36 percent growth during the first quarter and about 27 percent growth in the first 5 months of 2008-09 contributed to this rise in tax collection. The collection of value added tax (Vat) increased by 19.16 percent during the fiscal to Rs 4254.01 crore from Rs 3569.89 crore in 2007-08. Central Sales Tax (CST), on the other hand, declined by 3.03 percent to Rs 534.55 crore. The reduction in CST rate from 3 percent to 2 percent during the fiscal was officially attributed for the decline in the collections of CST. Sources said, the collections of professional tax increased by 19.07 percent to Rs 91.87 crore during the year compared to Rs 77.16 crore in the previous fiscal. While the collections of entry tax declined by 0.31 percent, the entertainment tax and land revenue collections declined by 23.22 percent during 2008-09.
A host of cases filed in Orissa High Court by some large corporates challenging the validity of Orissa Entry Tax Act, 1999, was mainly responsible for poor collections under the entry tax head. Decline in the contribution of two major public sector undertakings (PSUs), reduction in VAT collected from petrol and diesel from 20 percent to 18 percent and decline in the per litre price of petrol and diesel, resulted in a loss of more than Rs 140 crore. The collection of VAT from the aluminium major Nalco declined by 76.47 percent to Rs 3.93 crore during the fiscal. The CST payments by the company also declined by 30.84 percent to Rs 56.83 crore. The lower payment by Nalco pulled down the collections in Angul range by 0.20 percent.
The collections of CST and VAT from Steel Authority of India Ltd.(SAIL) also declined by 8.88 percent to Rs 130.16 crore from RS 142.85 crore in 2007-08. Shutting down of production or reducing production in industries located in Kalinganagar area resulted in decline in the collections from Jajpur circle from Rs 385.11 crore in 2007-08 to Rs 381.53 crore during the last fiscal.
