Sharad Pawar urges states to waive VAT, local taxes on food items

In his effort to bring down the soaring food prices, agriculture and food minister Sharad Pawar today urged states to waive the value-added tax and other local levies on foodgrain and sugar.

"I would urge the states to relookthe issue of taxes levied by them on foodgrain and sugar," he said while addressing the chief ministers' conference on price rise convened by the Prime Minister here today.

The rate of VAT and other local taxes on foodgrain is over 10% in states like Punjab and Haryana, while it ranges between 3 and 8% in Uttar Pradesh, Rajasthan, Madhya Pradesh, Bihar and Gujarat, he said.

"I am sure, removal or reduction of these taxes will receive your consideration in these difficult times," Pawar told the chief ministers.

On sugar prices, Pawar said, Delhi, Karnataka, Gujarat, Bengal and Bihar have already abolished VAT on imported sugar and similar steps required in other states. The VAT on sugar was 12.5% in Delhi and Karnataka, while it was 4%in Bengal and Bihar.

Commending Chhattisgarh for abolishing entry tax on sugar, Pawar asked Punjab, Madhya Pradesh and a few other states to remove such cess.

He also asked Uttar Pradesh to lift the restrictions on processing imported raw sugar in the state.