Industries associations of the State on Tuesday demanded a separate directorate for micro, small and medium industries (MSMEs) and rationalisation of value added tax (VAT) to have a level-playing field to compete with entrepreneurs from outside the State.
“After the creation of a new MSME Department, there is a need to create a separate directorate to deal with the problems faced by the entrepreneurs,” president of Odisha Small Scale Industries Association (OSSIA) Nishikanta Mishra told mediapersons after a meeting with Chief Secretary BK Patnaik.
Mishra who led a delegation of industries associations said frequent change in policies in allotment of land to MSMEs in different industrial units is creating problems.
While states like Gujarat, Maharashtra and Delhi have adopted a more progressive policy as far as change of constitution of company and sub-leasing or sub-letting of land are concerned, IDCO is demanding 50 per cent transfer fee on benchmark valuation.
“We demand that the land allotted to MSMEs be made free hold or the land allotted to MSMEs be transferred to Odisha Small Industries Corporation (OSIC) till it is made free hold,” Mishra said.
In a memorandum to the Chief Secretary, the delegation comprising representatives from OSSIA, Utkal Chamber of Commerce and Industries, Orissa Young Entrepreneurs Association (OYEA), Odisha Assembly of Small and Medium Enterprises and Odisha Industries Federation said government departments are not implementing the MSME policy announced by the Government in 2009 in the
matter of procurement of materials. “We requested the Chief Secretary to issue a circular to all the departments and the power distribution companies to abide by the industrial policy resolution for the development of MSMEs in the State,” Mishra said.
Expressing concern over the low procurement materials from micro, small and medium industries, Mishra said the composite tender policy of the State Government is the main stumbling block in the procurement of MSME products. The wide gap between VAT charged by the State Government and the central sales tax (CST) is another problem for the state entrepreneurs.
Several products manufactured locally are charged 13.5 per cent VAT while the same products procured from outside the State are charged 2 per cent central sales tax.
The local entrepreneurs are losing business to outside markets because of the wide gap in tax. The Chief Secretary assured the delegation that he would convene a meeting after Durga Puja to discuss these issues and find a solution to it.