M'rashtra metal traders set to join octroi stir

Non-ferrous metal and steel trade associations will observe a one-day bandh Monday to demand total abolition of octroi, said Rohit Shah, president of Bombay Metal Exchange.

Various trade associations including the Indian Merchants' Chamber and affiliates of chambers of commerce in the state are participating in the mass agitation led by Maharashtra State Octroi Abolition Committee.

"Maharashtra government promised to remove octroi immediately after replacement of sales tax by value added tax. Now, since nine month revenue from VAT has exceeded over Rs 900 crore, why should we continue paying octroi?" asked Rohit Shah.

Out of the three states that levy octroi, Gujarat and Punjab have agreed to remove it from next year, he said. Globally, octroi exists in only two countries "� Ethiopia and India.

More and more businesses have shifted out of the state over the past few years due to various taxes and the state is losing revenue and employment opportunities as well, Ashok Bafna, director, Bombay Metal Exchange.

"Metal prices will definitely come down if octroi is abolished," said a Mumbai-based non-ferrous metal dealer.

Bombay Metal Exchange's Shah said, "the government should also clear its stand on whether 4 per cent countervailing duty levied in the budget this year is MODVAT-able to registered dealers or not".

Another trader said imposition of 4 per cent additional countervailing duty in the budget has more than offset the benefit of reduction in import duty to 7.5 per cent from 10 per cent .

The Maharashtra State Octroi Abolition Committee, headed by upper house MP Eknath K Thakur, said in its release that the continuation of octroi after implementation of VAT is illogical and the state government must remove it immediately.