Imphal, December 22: Despite strong reservations expressed by the Opposition, the State Assembly passed the Manipur Value Added Tax Bill, 2004 and Manipur Ceiling on Government Guarantee Bill 2004 today.

Expressing strong reservations against the enactment of VAT, MPP MLA, Dr Nimaichand Luwang and BJP MLA, M Bhorot said that though VAT is an all India Bill, there are some confusions when viewed in the context of Manipur and urged that the Bill be referred to a Select Committee of the Assembly for due discussion.

Dr Luwang said that VAT is something new in India and implies that the sales tax will go directly to the companies concerned, after which the companies will pay the proceeds to the Govt.As this is an entirely new system of collecting taxes, it will do wise for the Govt to minutely discuss how much the Govt stands to gain over even lose.

Earlier the practice was to pay the tax at the Taxation office gate, he added.

M Bhorot suggested that the matter be referred to a Select Committee of the Assembly to discuss its finer intricacies before it is passed.

L Ibomcha also chipped in and said that it would be right to exert necessary pressure on the Centre to make up for any losses that the State may face once VAT is enforced.

Joining in the discussion, Agriculture Minister Ph Parijat said that the Bill is being introduced so that the practice of taking double tax from the business class is stopped.

As the Centre has agreed to bear any losses for three years after the Bill is passed, Parijat said that there is nothing much to be apprehensive about.

The Bill is set to be implemented all over the country by the first week of April next year, informed the Chief Minister.

The Bill has been discussed by the Centre for the last 5/6 years and only after through discussions, the States were asked to implement the same, he added.

VAT will also go a long way in curbing business houses from pocketing the tax on the sly, said.the Chief Minister and cited a number of examples.

During the discussion on Manipur Ceiling on Government Guarantee Bill, Chief Minister O Ibobi, who also holds the Finance portfolio said that the Bill is being introduced so that the Government may be able to keep a check on any Govt agencies, NGOs and Co-operative Societies which want to take loans from financial institutions with the State Govt as the guarantor.

This Bill will help monitor the borrowing which requires the State Govt to stand in as the guarantor, he added.

Many societies, firms and individuals which have taken loans from financial institutions with the State Govt as the guarantor have defaulted in paying back the borrowed amount, said the Chief Minister and added that the State Govt is forced to pay the loans along with the interest, which dents the Plan size.

The Bill contains the provision, that the State Govt will not stand in as the guarantor if the money borrowed from financial institutions cross one third of the over all resources of the State, explained Ibobi.

FPM MLA M Nilachandra said that there is urgent need for the Govt to take firm action against all loan defaulters.

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