Government gives heavy shock to industry by levying 5% extra burden on power- By P D Sharma
The Author, P.D. Sharma. *The Ludhiana-based Author is President of Apex Chamber of Commerce and Industry (Punjab) In today’s context industry has to beat global competition. This simply means that all operations of industry are mainly related...
*The Ludhiana-based Author is President of Apex Chamber of Commerce and Industry (Punjab)
In today’s context industry has to beat global competition. This simply means that all operations of industry are mainly related to imports and exports. Therefore industry of the land locked state of Punjab has to operate with maximum disadvantages. Punjab is far away from ports and sources of raw materials and market for the finished goods.
Punjab’s industry mainly survived due to the relatively cheap electric power and its comfortable availability.
It seems that Punjab Government’s focus on development excludes industry. It has been trying to put as many taxes on electricity as can be possible:-
1. Firstly it raised the burden of electricity duty by changing the mode from specific to ad valorem
2. Punjab government in the year 2005 got enabling power through legislation that it can raise electricity duty to as high as 25%.
3. At present it is charging 13% electricity duty.
4. Now it has devised a noble way of taxing electricity through Infrastructure Development Fees. It is equal into 5% electricity duty.
5. It is charging 10 paisa a unit as an octroi on power when there is no octroi in the state. People are paying heavy property tax in lieu of octroi.
There are many other short coming in the distribution system where industry has to bear etc. burden by generating its costly captive power due to frequent unscheduled power cuts.
Apart from Infrastructure Development Fees on power more burdens is coming on industry through increase of taxes on diesel and petrol.
There are other indirect ways of burdening industry such as levying entry tax/advance tax.
There has been a persistent demand of industry to make electricity duty VATable. Government was convinced on this demand. Government has given a heavy shock to the industry by levying 5% extra burden on power. This will certainly have a very bad effect on industry. Rather it will crush the industry. Government is urged to exempt industry from the new infrastructure development fees.
Date:
Saturday, May 23, 2015