VAT bandh paralyses trade

The nationwide bandh against the proposed Value Added Tax paralysed trade and commerce in several parts of the country on Monday, with traders threatening to go on an indefinite strike unless the new tax regime is made trade-friendly and essential commodities are taken out of its ambit.

The wholesale commodity markets in Delhi, Mumbai, Kolkata and Chennai remained closed and retail trade was also hit as traders protested against the "harsh" clauses of VAT.

They alleged that prices of essential items would go up under the new tax regime slated from April 1, 2005.

Trading activities came to a grinding halt in major states like Maharashtra, West Bengal, Assam, Andhra Pradesh, Rajasthan, Punjab and Uttaranchal as wholesalers and retailers chose to keep their shutters down in protest against VAT.

The crisis over VAT: Complete coverage

Although the trade bandh was "partial" in states like Delhi, Karnataka, Tamil Nadu, Kerala and Jammu & Kashmir, the traders took to the streets and staged demonstrations against the imposition of VAT.

The  stock market and the financial sector were open today but the BSE Sensex shed 50 points to close at 6,534 points.

Traders association, led by Confederation of All India Traders, threatened to go on a nationwide indefinite strike if their demands are not met.

CAIT secretary general Praveen Khandelwal said that the traders' association has sought a meeting with Empowered Committee of State Finance Ministers on VAT by February 27 to sort out differences on the new tax regime.

If the VAT panel fails to carry out necessary changes as sought by traders, Khandelwal said traders would go on a hunger strike on March 17.