Wheat products like flour, suji and maida and all varieties of pulses will vanish from Malgodown, the biggest wholesale market of the State here, and other business centres from Tuesday because traders here have decided not to deal in these products as they invite an exorbitant five per cent VAT. These products do not invite VAT in neighbouring and many other States of the country.
“Demanding withdrawal of VAT on wheat products and pulses, we had submitted several memorandums to the State Government. Since the Government was non-committal to our demands, we had given an ultimatum to stop trading on these products from December 9,” said traders association joint secretary Srikant Sahu here.
All the chambers of commerce across the State had been informed about it, Sahu said, adding that no trader would order for these products or sell them until the VAT is exempted from the wheat products and pulses. “The existing stock of these products in Malgodown would exhaust in a day or two,” Sahu warned.
Odisha is a major consuming State in terms of wheat products and pulses. Out of nearly nine lakh tonnes of these products consumed in the State, Odisha produces only ten per cent of its demand, sources said, adding that the annual business turnover of these products crosses `4,500 crore.
“The five-per cent VAT on these products results in a price difference of `300 per quintal in comparison to the neighbouring States,” said a pulses trader, disclosing that the arbitrary VAT imposition has given way to unfair trade practices as a result against a revenue target of `225 crore, the Government ends up collecting a meagre `30 crore.
On the other hand, the traders suggest that the Government would benefit considering imposition of only one-per cent entry tax on these products and do away with the VAT burden like in 23 other States.