The conference of Chief Ministers of BJP ruled states was held today. Apart from the five Chief Ministers, Shri Sushil Modi Dy. Chief Minister of Bihar and two ministers from Orissa also participated in the meeting.
It was presided over by Shri Lal Krishna Advani. Shri Atal Bihari Vajpayee, Shri Jaswant Singh, Shri M. Venkaiah Naidu and other senior leaders also participated.
The statement of Shri Lal Krishna Advani has been separated circulated.
In his address Shri Vajpayee reminded the CMs of the commitments that we had made to the people and focused on the accountability of our administrations. He asked them to set-up a very strong mechanism at various levels within the state administration to receive people’s complaints and grievances and to ensure their redressal. The machanism should also ensure that replies are sent to all complaints.
Poverty alleviation:
The conference expressed its concern at the reduction in outlays on the various poverty alleviation programmes since the coming of the UPA Government. At the same time, a critical review was made of the action being taken within the BJP states for effective implementation of not only the centerlly sponsored schemes but also the various other schemes started by the states from other own resources. The Chief Ministers will within a fortnight send a detailed narration of all schemes to the central office. They will also have them analyzed so that unduly fragmented schemes may be consolidated.
Supreme Court judgment on ban on Cow slaughter :
The conference took note of the 7 judges constitutional bench judgment of the Supreme Court delivered in October 2005 about the Gujarat law. In the land-mark judgment the court has upheld the blanket ban on slaughter of cows and bulls and bullocks, irrespective of their age. It was decided at the conference that the BJP ruled states will review their existing legislation on the subject and re-inforce it to the extent now permitted by the Supreme Court.
Naxalism:
The conference expressed concern at the rapidly growing challenge of Naxalism. This growth is largely a result of the soft attitude of the UPA Government. Now Naxalite activity extends over one fourth of India’s territory and is unified under one party, with a coordinating arrangement with Maiosts in Nepal. At the conference a number of steps to be taken at the state and the local level were considered and those have been separately circulated to the states. It was emphasized, however, that given the gigantic size of the problem it can only be solved by concerted action of the Central and the state governments. Keeping in view weak will so far shown by the Center, it was decided that the BJP Chief Ministers will seek a meeting with the Prime Minister, draw his attention to the seriousness of the problem and seek his support.
Illegal Migrants:
The conference expressed its dis-satisfaction at the weak response of the Central Government to the quashing of the IMDT Act by the Supreme Court. It was decided that in the BJP ruled states action will be taken in accordance with the Foreigners Act to identify and deport illegal migrants.
VAT:
The conference undertook an exhaustive review on the issue of VAT. It was recalled that this progressive tax system had been promoted by the NDA Government. The Empowered committee of state finance ministers was set up by the NDA Government. Unfortunately, when the system was sought to be introduced in April 2005, it was then found that it had several loop-holes and deficiencies. The tax information system, so vital for holistic operation of VAT in the country, had not been established. Road map for the abolition of CST, which is incongruous with VAT, had not been prepared. The procedures for grant of refunds and offsets to the traders had not been firmed up. Several concerns of smaller traders had not been attended to. Also, a number of major states had not been persuaded to implement VAT. In such circumstances, the BJP Chief Ministers when they met early in 2005 felt compelled to postpone the adoption of VAT in their states.
At the conference today a review was made of the experience of eight months in the states and union territories which have implemented VAT. Still, there are several deficiencies and concerns which subsist. Those are mentioned below:
(A) Some major states, particularly the large state of Uttar Pradesh, remain outside the system.
(B) The road map for abolishing CST still remains unclear. Even assuming that the Empowered committee will recommend its reduction to 2 percent from 1 April 2006, issues would still remain concerning compensation to the states which will loose on account of abolition of CST.
(C) The flexibility given to states exempting items of local importance is still limited to 12 items. That flexibility is inadequate.
(D) The Empowered Committee needs to formulate proposals for enhancement of avenues of state finance by measures such as devolution of service tax to the state.
(E) As a measure of equity it is essential that compensation for less of revenue needs to be provided to the extent of 100 percent in the first year of adoption of VAT.
The conference decided that all these matters will be taken up with the Empowered Committee due to take place on 16 December 2005. The Finance Ministers of BJP state governments will meet prior to that meeting and formulate their combined position.
The conference decided in principle that BJP ruled states will adopt VAT. While doing so, due care will be taken to fully establish the tax information network and to educate not only the officials but also the trading community and the public. The flexibility permitted in the system will be used to address the concerns of the trading community and local features.
The problems of states with primary resources, such as Chhattisgarh and Jharkhand, which will suffer revenue lose on account of reduction/abolition of CST were highlighted. The Central Government was requested to provide them adequate fiscal compensation. In that connection the proposals made in the 10th Plan mid term appraisal document for higher royalty in coal and other minerals and for having devoted large areas to forests ore important.
It was presided over by Shri Lal Krishna Advani. Shri Atal Bihari Vajpayee, Shri Jaswant Singh, Shri M. Venkaiah Naidu and other senior leaders also participated.
The statement of Shri Lal Krishna Advani has been separated circulated.
In his address Shri Vajpayee reminded the CMs of the commitments that we had made to the people and focused on the accountability of our administrations. He asked them to set-up a very strong mechanism at various levels within the state administration to receive people’s complaints and grievances and to ensure their redressal. The machanism should also ensure that replies are sent to all complaints.
Poverty alleviation:
The conference expressed its concern at the reduction in outlays on the various poverty alleviation programmes since the coming of the UPA Government. At the same time, a critical review was made of the action being taken within the BJP states for effective implementation of not only the centerlly sponsored schemes but also the various other schemes started by the states from other own resources. The Chief Ministers will within a fortnight send a detailed narration of all schemes to the central office. They will also have them analyzed so that unduly fragmented schemes may be consolidated.
Supreme Court judgment on ban on Cow slaughter :
The conference took note of the 7 judges constitutional bench judgment of the Supreme Court delivered in October 2005 about the Gujarat law. In the land-mark judgment the court has upheld the blanket ban on slaughter of cows and bulls and bullocks, irrespective of their age. It was decided at the conference that the BJP ruled states will review their existing legislation on the subject and re-inforce it to the extent now permitted by the Supreme Court.
Naxalism:
The conference expressed concern at the rapidly growing challenge of Naxalism. This growth is largely a result of the soft attitude of the UPA Government. Now Naxalite activity extends over one fourth of India’s territory and is unified under one party, with a coordinating arrangement with Maiosts in Nepal. At the conference a number of steps to be taken at the state and the local level were considered and those have been separately circulated to the states. It was emphasized, however, that given the gigantic size of the problem it can only be solved by concerted action of the Central and the state governments. Keeping in view weak will so far shown by the Center, it was decided that the BJP Chief Ministers will seek a meeting with the Prime Minister, draw his attention to the seriousness of the problem and seek his support.
Illegal Migrants:
The conference expressed its dis-satisfaction at the weak response of the Central Government to the quashing of the IMDT Act by the Supreme Court. It was decided that in the BJP ruled states action will be taken in accordance with the Foreigners Act to identify and deport illegal migrants.
VAT:
The conference undertook an exhaustive review on the issue of VAT. It was recalled that this progressive tax system had been promoted by the NDA Government. The Empowered committee of state finance ministers was set up by the NDA Government. Unfortunately, when the system was sought to be introduced in April 2005, it was then found that it had several loop-holes and deficiencies. The tax information system, so vital for holistic operation of VAT in the country, had not been established. Road map for the abolition of CST, which is incongruous with VAT, had not been prepared. The procedures for grant of refunds and offsets to the traders had not been firmed up. Several concerns of smaller traders had not been attended to. Also, a number of major states had not been persuaded to implement VAT. In such circumstances, the BJP Chief Ministers when they met early in 2005 felt compelled to postpone the adoption of VAT in their states.
At the conference today a review was made of the experience of eight months in the states and union territories which have implemented VAT. Still, there are several deficiencies and concerns which subsist. Those are mentioned below:
(A) Some major states, particularly the large state of Uttar Pradesh, remain outside the system.
(B) The road map for abolishing CST still remains unclear. Even assuming that the Empowered committee will recommend its reduction to 2 percent from 1 April 2006, issues would still remain concerning compensation to the states which will loose on account of abolition of CST.
(C) The flexibility given to states exempting items of local importance is still limited to 12 items. That flexibility is inadequate.
(D) The Empowered Committee needs to formulate proposals for enhancement of avenues of state finance by measures such as devolution of service tax to the state.
(E) As a measure of equity it is essential that compensation for less of revenue needs to be provided to the extent of 100 percent in the first year of adoption of VAT.
The conference decided that all these matters will be taken up with the Empowered Committee due to take place on 16 December 2005. The Finance Ministers of BJP state governments will meet prior to that meeting and formulate their combined position.
The conference decided in principle that BJP ruled states will adopt VAT. While doing so, due care will be taken to fully establish the tax information network and to educate not only the officials but also the trading community and the public. The flexibility permitted in the system will be used to address the concerns of the trading community and local features.
The problems of states with primary resources, such as Chhattisgarh and Jharkhand, which will suffer revenue lose on account of reduction/abolition of CST were highlighted. The Central Government was requested to provide them adequate fiscal compensation. In that connection the proposals made in the 10th Plan mid term appraisal document for higher royalty in coal and other minerals and for having devoted large areas to forests ore important.
(Shyam Jaju)
Office Secretary
Office Secretary
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