Business community demands end to ‘illegal taxation’ by Dimapur Municipal Council

DIMAPUR — The Dimapur Chamber of Commerce and Industries (DCCI) has accused the Dimapur Municipal Council (DMC) of imposing unregulated taxes and fees on items that fall under Goods & Services Tax (GST) regime in complete violation of an official ban, and demanded prompt action from the state government.

In a press statement issued on Friday, the DCCI claimed that despite a Nagaland government notification on November 16, 2021 that prohibited all municipal bodies and town councils from collecting “any kind of tax/fees on items/goods that comes under the Goods & Services Tax (GST) regime”, the DMC has been “imposing unregulated tax, fees etc., in complete violation of the standing government notification”.

“These unregulated activities are therefore illegal and unacceptable and requires prompt redress. If this trend is practiced in Dimapur, then it will have cascading effect in all the districts of Nagaland. Public should also be aware as any taxation is directly or indirectly borne by the common citizens.

“Since the town and municipal councils are under the state government, they should function as per the Municipal Act and try their best to ease the burden of the public. The government should also take prompt action against any town or municipal council functioning otherwise,” the statement read.

According to the DCCI, the business community in Dimapur is facing a double jeopardy “due to the prevalence of multiple taxations and the practice of double taxation by the municipal authority”.

“DCCI is pained to come across the system where on the one hand the GST regime is squeezing out a major chunk of business proceeds from the already exhausted and exploited business community, while on the other hand, the municipality has been imposing unregulated taxes and fees upon several businesses,” it stated.

It cited the instance of the DMC reportedly collecting “lakhs of rupees” as tax from second-hand clothes, which falls under GST.

“The DMC is also collecting INR 1000 per month from every shop and agencies in the name of ‘Regulation fee.’ Recently the DMC also levied some few lakh rupees as one-time payment from shops selling decorative items for the ensuing festive season.

“On the other hand, the DMC is not fixing the rate of perishable items, which do not come under GST, but randomly imposing taxes on these items. In the case of tomato, the council collects INR 500 from each Tata Mobile (pick-up truck) carrying tomatoes. Again, after reaching the market, the DMC collects INR 3 per kilo of tomato,” the statement claimed.

 Likewise, rate of other perishable items, potatoes and onions, are not fixed but taxes are collected, it stated.

“Under such a scenario, the DMC which is responsible for rate-fixing and controlling prices, is encouraging syndicate system. And ultimately, the public are at the receiving end since they are directly or indirectly adversely affected by fluctuation in prices,” it stated.

Also, the DCCI asserted that the DMC should immediately stop summoning in groups businessmen or dealers of various trades and products.