Mumbai: The Union Finance Minister, P. Chidambaram, preferred to stay away from trade representative bodies and national commodity exchanges demand to scrap commodity transaction tax.
There was expectation that Chidambaram would propose to either reduce or scrap CTT when he replies to the debate in the Lok Sabha on the Finance Bill, 2008. Earlier the two apex bodies — the Confederation of Indian Industry and the Associated Chambers of Commerce and Industry of India — have requested the Government to reconsider the tax. The commodities markets are already grappling with many levies such as the central sales tax, the value-added tax and excise and customs duties, CII had said.
“It was a big disappointment. Trade volumes will take a severe beating once the cost of transaction increases after implementation of CTT. Valuations of commodity exchanges will be hit, particularly when foreign investors are showing keen interest in picking up stakes,” said a commodity exchange chief.
Considering a total turnover of around Rs 40-lakh crore per annum in all commodity exchanges, the Government will garner a maximum revenue of Rs 680 crore by imposing CTT at the rate of 0.017 per cent.
There was expectation that Chidambaram would propose to either reduce or scrap CTT when he replies to the debate in the Lok Sabha on the Finance Bill, 2008. Earlier the two apex bodies — the Confederation of Indian Industry and the Associated Chambers of Commerce and Industry of India — have requested the Government to reconsider the tax. The commodities markets are already grappling with many levies such as the central sales tax, the value-added tax and excise and customs duties, CII had said.
“It was a big disappointment. Trade volumes will take a severe beating once the cost of transaction increases after implementation of CTT. Valuations of commodity exchanges will be hit, particularly when foreign investors are showing keen interest in picking up stakes,” said a commodity exchange chief.
Considering a total turnover of around Rs 40-lakh crore per annum in all commodity exchanges, the Government will garner a maximum revenue of Rs 680 crore by imposing CTT at the rate of 0.017 per cent.
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