Hota panel report to be implemented in three years

The state government expects to implement recommendations given by the Hota committee, an expert panel constituted to suggest revenue enhancement measures, within three years.

“The recommendations which require administrative decisions can be implemented in a year. But for suggestions that warrant legal changes, administrative restructuring and building necessary infrastructure, the implementation span would range from 2-3 years,” finance minister Prafulla Ghadai said in the state assembly.

“Detailed discussions were held under the chairmanship of the Chief Secretary and secretary (finance) on the report of the expert committee headed by retired bureaucrat Sanjib Chandra Hota. The concerned departments have been asked to scrutinize the panel's recommendations and offer suggestions to the finance department,” he added.

The state government is expected to garner additional revenue of about Rs 2,000 crore per annum if the recommendations of the committee are accepted in toto.

The Hota committee had projected that the cumulative impact on collection of Value Added Tax (VAT) from petroleum products after commissioning of Indian Oil Corporation Ltd's (IOCL) refinery at Paradeep during 2013-24 may be of the order of Rs 50,195.89 crore.

It observed that this will create a big dent in the state's resources, especially because the massive expansion of the capacity of IOCL could also displace other retailers of petro goods who pay taxes.

The recommendations made by the Hota committee include hiking the base rate of VAT from four per cent to five per cent, creation of a separate wing for professional tax administration and fixation of higher rate for water used by industries during drought years.

In the mining sector, the committee had suggested that at least Rs 1,000 per hectare per annum be fixed as the surface rent for land not accessible to land revenue with respect to major minerals. Moreover, it has also stated that in the future, all mines of important minerals should be recommended and leased out only in favour of Orissa Mining Corporation (OMC).