Retailigence

“Club of Knowledge Hunters”

Kerala slaps 10 pc surcharge on retail chains

Posted by retailigence on August 30, 2008

Under pressure from the domestic traders, Kerala government has slapped a 10 per cent surcharge on the big retail chains, thus becoming the first state in the country to impose such a levy on super and hyper markets run by monopolies.

The proposal in this regard, made by state Finance Minister T M Thomas Isaac in the budget presented in March, came into effect with assembly adopting Finance Bill 2008-09 on Tuesday. The surcharge would be applicable on retail chains, including direct marketing chains, which import at least 50 per cent of their stock from outside the state or the country.

Commercial ventures, whose 75 per cent of the total business is in retail space and total turn over exceeds Rs 5 crore a year would come under the purview of the surcharge. The retail chains run by the state and those in the co-operative sector such as Civil Supplies Corporation and Consumerfed, would, however, be exempted from the levy. Curbing the entry of both national and multinational monopolies in retail sector has been an openly acknowledged policy of the ruling party.

The coalition, however, is aware of the constraints it has in imposing total ban on monopolies and that it could only restrict them through regulatory measures like additional levies. The well-organised trading community in Kerala has been spearheading a campaign demanding tough measures to curb big retail chains and earlier this month organised a statewide shutdown to press its demand.

Source: Economic Times

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