Confederation of Nagaland Chamber of Commerce and Industry (CNCCI) has appreciated the active role of the newly-elected urban local bodies (ULBs) to improve towns and municipalities, and expressed its full cooperation and support on behalf of the business community.
Contending that it was the mandate of the ULBs to issue trade license, collect sanitation tax and impose rent on their assets, the trade body however called for thoroughly examining such collections before imposition as these could directly come in conflict with Goods and Services Tax (GST), state government orders and “promote syndicate and monopoly through licensing raj.”
CNCCI chairman Dr Khekugha Muru and general secretary Dr Seyievilie Mor in a press release urged the ULBs to ensure market rate fixation on any item and goods, including trade license and sanitation fees, were done after thorough consultation with district chambers and not unilaterally, as per government order dated September 14, 2021).
They said they were appealing in the interest of ULBs, business community and consumers, and to maintain cordial relationships and a supportive business community.
Claiming of having recently received complaints from the business community that certain ULBs were forcefully trying to impose monthly collection on GST items and high rates on perishable items monthly, per load and per kg, they warned that this would lead to abnormal and alarming price rise of essential commodities, deeply affecting the common man.
They asserted that they would not allow brazen acts under any circumstances, but go all out to safeguard the business community and consumers.
Further, they directed the district chambers to be vigilant against imposition of new taxes and collections that were in direct confrontation with various state government orders and central government laws, and initiate swift intervention and flag the issue to the CNCCI, so that precedence was not set for ULBs in Nagaland that could affect business community and consumers.
They said previous ULBs had set a trend of introducing a licensing and lessee system on various goods and items across Nagaland, giving exclusive right to individuals or few business houses, which led to monopoly and syndicate system in many commodities.
Pointing out that the direct end result was price escalation of commodities, as prices were fixed by the monopolists and syndicates, they alleged that the lessees also took cuts/commission/share by forcefully collecting over and above prescribed rates in permit/license. They declared that such a system would not be tolerated and all means would be explored to stop such undemocratic, unethical practices.
The duo also reminded the ULBs that collection of taxation and setting up of collection gates on national, international and state highways were against the GST and the road tax had to be paid to the government.
As the GST had subsumed all taxation on goods, they declared all forms of entry tax/transit pass on goods and items as illegal. Also, the road tax paid during vehicle registration and yearly renewal of road permit by commercial vehicles covered the toll incurred on the roads by the vehicles.
They appealed the ULBs to refer to government orders and laws before taking any decision in order to avoid legal and unpleasant friction —the state government order dated September 14, 2021 banning all forms of tax/fees on items/goods that came under GST by town councils and municipalities; and the May 1, 2022 state government order that banned all gates except inter-state check gates, including the gates set up by town councils, municipal councils, and government departments.
On collection of parking and toll taxes, they urged the ULBs not to collect such taxes on state, national and international highways even within towns and municipal areas, unless they took over those roads from the government and started maintaining and managing them. They maintained that the citizens and businesses community could not pay multiple taxes, in the form of road tax to the government and parking/toll tax to ULBs on the same road.
They said they had recently come across certain circulars of leasing out various collections and taxes to individual parties, which was totally unacceptable and unappreciated, as the ULBs as an arm of the state government, and constitutional and public body could not give away exclusive rights to collect taxes to individuals or third parties.
They claimed that the past such leasing out of rights to impose taxes had resulted in misuses by forceful collection of more than prescribed rates by ULBs, thereby harassing the business community beyond limit.
They pointed out that over and above the revenue generated through lessees or third parties in the past had resulted in heavy losses for the ULBs as most of the lessees had submitted revenues well below the fixed amount, thereby affecting the public services.
Finally, they directed the district chambers that not to allow individuals or businessmen involve in rate fixation with ULBs under any circumstances, as individuals often were not aware of the broader picture of the market, and thereby potentially misguide the ULBs in price fixation, leading to incurring of huge losses by the business community and affecting the consumers. They stressed that the district chambers should ensure that rates were fixed by the ULB in consultation with them.