Rajasthan Industry Up In Arms Over CST

Jaipur, January 20: | Updated: Jan 21 2003, 05:30am hrs
Even as the Ashok Gehlot government is faced with an internal review from the Congress high command, the states small-scale industry with over Rs 3,368 crore investment has threatened to derail the state finances if an immediate solution is not found for adjusting the central sales tax (CST) starting the new fiscal - when the Value Added Tax (VAT) comes into effect.

Decrying apathy of the finance minister-led three member sub-committee formed from by the state cabinet on the issue, over 2.31 lakh small-scale units in the state have decided to take the government to task.

The new excise policy of the state is also poised to destabilise the industry as it is harmful in the long run, KL Jain, president of Rajasthan Chamber of Commerce and Industries (RCCI) told FE. Making up an important source of revenue to the state coffers, these units have expressed their inability to absorb the burden of CST along with other hurdles like lopsided policies of government industrial bodies like Rajasthan Industrial and Investment Corporation (RIICO).

RIICO, though an industrial promotion body of the government has had policies that have harmed or served as disincentive to entrepreneurs, said TC Choudhary, president of United Council of Rajasthan Industries (UCORI) told FE on Thursday. The industry has criticised RIICOs rules that disable the unit holders to expand their operations even within the specified parameters of their premises.

Either the state government needs to remove completely the CST or else it has to find a way to compensate appropriately, said Narendra Kumar Jain, joint secretary, RCCI.