U-turn by Govt on Vat on textiles

  The Kiran government  imposed 5% Vat  on textiles from July 2011, which is highest compared to any other state. The government view was that one per cent vat on a turnover of 50 lakhs wouldn’t be burdensome as the turnover in Textile business rarely reaches that amount. However, the cloth merchants refused to bow down. They have been protesting against the pricey Vat ever since.

The government dilly-dallied all these days, saying that they will appoint a
 sub-committee to review the issue which never happened.  But to everyone’s surprise, the upcoming General Elections seems to have played upon the government’s mind. The CM has now declared that the Vat will be lifted, but it will come into force only after the orders are passed
 The government was forced to scrap the Vat (Value Added Tax), in response to the agitation by the cloth merchants for two long years. The merchants point out that it is unjust as no other state in the country imposes it.
The YSR Congress party declared its support for the agitation. The Party President YS Jagan Mohan Reddy had staged a dharna on January 27 in Narasarao pet in Guntur District. All the political parties in the state have pledged their support for the demands of the cloth merchants.
 The government agreed to give a few concessions along with a promise, that if the VAT is not imposed in any other state, it will be lifted in our state.  At that time, the by-elections caused by resignations given by the MLAs in support of YSRCP, had tied hands of the government.
But as the government did not keep up its promise, the merchants began to agitate again. The state ministers Anam Ram Narayana Reddy, TG Venkatesh, G Prasad Kumar, MLAs Madhusudan , Usha Rani, and Prakash, the President of AP Textiles Association, and its Secretaries met the CM in his camp office, and asked him to consider the recommendations made by the Sub-committee. The CM agreed to lift the VAT on Textiles saying, that he had no desire to harass the merchants, but he was forced to do so as the financial condition of the State was in a woeful state when he took over as CM.
The government is going to issue orders on lifting the VAT in a day or two.  The textile merchants  haven’t paid VAT in the last two years. The government is insisting that the merchants pay the arrears. This has become a bone of contention between the government and the merchants, as the latter is refusing to do so. The merchants are demanding that VAT along with arrears be cancelled.

It should have been done long back: YSRCP
The official President of YSRCP Janak Prasad said that it was not just to impose VAT on Textiles as no other state in the country had done it. He also said that YSRCP had always supported the merchants in their demands. The party president YS Jagan had staged a sit-in protest Narasarao Pet in Guntur district. The honourary president of YSRCP, YS Vijayamma too expressed solidarity with the merchants. As a convenor of the Party Trade Union, Janak Prasad too participated in the agitations in the districts, but the government stuck to its stand. Now in view of the General Elections, the government has agreed to scrap the VAT, to woo cloth merchants for votes.  This is a victory for the agitation taken up by the merchants and the opposition parties.