Short tenure of CCT may affect state's migration to GST

Short tenure of the bureaucrats posted as commissioner of commercial taxes (CCT) in Orissa may impact the smooth transition of the state to the proposed Goods and Services Tax (GST) regime, which is set to be implemented from April 2010. This is also impacting the collection of commercial taxes in the state.

The state witnessed appointment of 7 CCTs in last 8 years with only three of them being able to complete one year in the post. While G Mohan Kumar had a tenure of 3 years from 2001 to 2004, U P Singh’s tenure (6 months from Apr-2004 to Sept 2004) was the shortest.

Pradeep Kumar Jena was the commissioner for 11 months from September 2004 to August 2005 and Tara Datta held the post for 13 months from August 2005 to September 2006.

A K Samataray, the next incumbent had a tenure of 11 months from September 2006 to August 2007 and A P Padhi barely completed a year in that post.

Tuhin Kanta Pandey, the present CCT who took charge in August 2008 is slated to go on a Central deputation soon making the task of the next incumbent to lead the department to the GST regime difficult, sources said.

“Short tenure of the CCT has deprived the incumbents from giving clear-cut direction in tax mobilization. Since the state will migrate to the proposed GST regime in next nine months, a person familiar with the basics and with a relatively longer tenure need to be appointed”, a senior official of the state finance department said.

Meanwhile, impacted by the slow down in the state’s economy, the collection of commercial taxes in Orissa declined by 2.75 percent during the first quarter of 2009-10. The total collection during this period was Rs 1043.48 crore compared to Rs 1114.16 crore in the previous fiscal.

The decline is mainly attributed to 45.27 percent decline in the collection of Central Sales Tax (CST) and 6.42 percent decline in the collection of entry tax. However, the collection of value added tax (VAT) continued to be positive with a growth of 5.8 percent.

The collection of VAT was Rs 843.06 crore during the first three months of the current fiscal compared to Rs 786.13 crore during the corresponding quarter of 2008-09.

Sources said, the collection of CST declined mainly due to the drop in the rate from 3 percent prevalent in the first quarter of 2008-09 to 2 percent in the first quarter of 2009-10.The total CST collection was Rs 86.96 crore compared to Rs 158.9 crore during the same period last fiscal. On the other hand, the decline in the entry tax was officially attributed to a large number of litigations pending before the Orissa High Court and Supreme Court of India.