The Madras Paper Merchants' Association has appealed to the Tamil Nadu government to abolish the recently introduced re-sale tax on paper and paper boards. The introduction of the tax on July this year has resulted in an increase of Rs 2,000 per tonne of all paper and board varieties. This increase has put additional burden on the notebook, printing, publishing and a variety of other industries, according to an association press release. In a petition submitted to the Chief Minister, the association has pointed out that paper and paper boards are already paying 16 per cent excise duty and 0.125 per cent excise cess at the point of manufacture. Besides, they also pay four per cent Central sales tax for goods coming from outside the state, 10 per cent general sales tax in Tamil Nadu, five per cent surcharge on sales tax and one per cent re-sale tax at every point of sale. In addition, there is also a turnover tax for certain dealers who exceed a certain limit of turnover.
"The recent introduction of re-sale tax has increased cost by about Rs 2,000 per metric tonne on all paper varieties. Since paper is an essential commodity, levy of this tax will hamper the progress of education in the state. If the government reduces the cost, there will be increase in the consumption levels of the commodity," the release said. The per capita consumption of paper and board in the country is about five kgs as against 25 kgs in China and 300 kgs in the US, it added.