Start freight equalisation scheme, Punjab industry body urges

PTI / Jun 18, 2007, 14:05 IST

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Industries body in Punjab urged the state government to introduce a freight equalisation scheme that will compensate exporters against extra transportation charges.

Start freight equalisation scheme, Punjab industry body urges

LUDHIANA: With an aim to neutralise the impact of locational disadvantage, industry bodies in Punjab have asked the state government to introduce a freight equalisation scheme that will compensate exporters against extra transportation charges. "Under the scheme, the exporters will be compensated against paying higher transportation charges for bringing in raw material and sending finished products out of the state.Besides boosting exports, it will also help them to remain competitive," Engineering Export Promotion Council Regional Chairman S C Ralhan said. The state industry also sought to bring down the rate of electricity duty from 10 per cent to 5 per cent and a revival package for SSI units, offering interest free loans with 10 years utilisation period. PHD Chamber of Commerce and Industry Co-Chairman, Punjab Committee, R S Sachdeva asked the state government to keep the general rate of VAT rate at eight per cent, to introduce freight equalisation scheme for exporters and to speed up the process of VAT refund in the coming budget to be presented on June 20. "This common rate applicable to most of the commodities with exception shall lead to a progressive taxation system at the state level and generate higher revenue by encouraging compliance and widening the base of taxable commodities," he said. Stating that the delay in the tax refund causes the blockage of working capital requirement of the industry, he urged the government to adopt the same system of giving credit on capital goods as prevalent under Excise Act. According to industry analysts, the industry gets VAT refunds after 100-150 days compared to the 60 days time stipulated for its disbursement under VAT system.

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