By Bizodisha Bureau, Bhubaneswar, March 27, 2016 : All eyes are now set on the outcome of the Tuesday’s high-level meeting between state government and Federation of All Odisha Traders’ Association (FAOTA).

The two decides will resume their inconclusive talk on the demand for withdrawal of the 5 per cent Value added tax on dal, sugar and wheat-based products.

The high-level meeting held on Friday under the chairmanship of finance minister Pradip Kumar Amat between the Odisha government and representatives of traders’ body had failed to arrive at any conclusion.

Food supplies and consumer welfare minister Sanjay Das Burma, principal secretary of food supplies and consumer welfare department Madhusudan Padhi, chief secretary Aditya Prasad Padhi and finance secretary R Balkrishnan were also present in the meeting.

“In the last meeting, we tried to tried to impress upon the state government that it must remove the VAT on dal, sugar and other essential food items, especially the ones made from wheat. While 24 of the 29 Indian states have done away with VAT on food items, Odisha continues with it. As a result, it has led to unfair trading, resulting in huge loss of revenue to the state exchequer,” FAOTA general secretary Sudhakar Panda said told “Bizodisha” on Sunday.

He added that if the state government cannot not completely remove the 5 per cent VAT rate on food items, – it must reduce it to 1 per cent which can to a great extent check illegal procurement of the essential items from neighbouring states and result in doubling of revenue earning.

Mr Panda hinted that in the last meeting the government offered the FAOTA to reconsider its decision saying that fulfillment of their demand would put additional burden on the state which is under currently under financial stress.

Former finance minister Panchanan Kanungo, while expressing his concern over the huge gap between the wholesale and retail price of food items, – said the state government should make its enforcement machinery active to check tax evasion by unscrupulous traders.

Professor Dr Asit Mohanty of XIMB University said the FAOTA should wait till the Goods and Services Tax (GST) was introduced when the VAT would be redundant.

“I will appeal the FAOTA not to go ahead with their proposed strike and wait till the GST is introduced. Otherwise, the common people will be subjected to exploitation by black marketeers,” said Dr Mohanty.