Tax evasion of several crores by GPs: ZP vice prez

Meeting convened to verify tax amount payable by local bodies

Despite several notices by the Commercial Tax department, many Gram Panchayats (GP) of the district are yet to pay the tax amount of several crores, for works and services tendered by them.

This, according to L Madappa, Vice President of Zilla Panchayat, had resulted in approximately Rs 100 crore revenue losses to the State government. Despite a Tax Deduction at Source (TDS) system of the Commercial Tax department, many GPs are found to be paying the tax amount to the contractors, rather than the department, he alleged.

These statements caused a few heated moments between Madappa and Chief Executive Officer of Zilla Panchayat, P A Gopal, who took objection to the same, at the KDP meeting, held here on Saturday. “Claiming that GPs evade taxes which amount to hundreds of crores across the State, without proper documents, would be too far fetched,” he said.

Earlier, Madappa noted that 235 GPs of the district had bought devices such as bulbs, computers etc worth at least Rs 10-15 crore. However, no GP of the district had paid Value Added Tax or other related taxes, he said. 

“VAT amounts to 14 per cent of the total bill. While the GPs or concerned departments should pay the tax amount to the government under TDS, they are including the tax amount in the bills of the contractors. The GPs also do not ensure whether these contractors pay the tax amount to the government,” he added.

To add credence to the claims made by Madappa, Nagarajappa, Commercial Tax Officer, said that despite several notices, only few GPs have paid the amount to the department.

Gopal said that such a practice by local bodies would amount to a criminal offence, due to which action could be initiated against concerned officials.

Considering the importance of the issue, ZP president Pushpavathi Amarnath requested the CEO to convene a special meeting regarding tax collection, next week. All departments are expected to reveal details of the taxes paid by them at the meeting, she said.

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