Party sharply divided over low Alcohol Tax rate issue
By P. Sreekumaran
THIRUVANANTHAPURAM: The Congress is sharply divided over the low alcohol tax rate cut unilaterally announced by Chief Minister V. D. Satheesan. Resentment over Satheesan’s one-man show is growing not only within the Congress but also among the allies. Satheesan has angered both by announcing without consultations the tax rate cut on low alcohol in the State.
Senior Congress leader and former Kerala Pradesh Congress Committee (KPCC) president V. M. Sudheeran fired the first salvo against the Chief Minister by bluntly asking him to withdraw the proposal. The issue should have been discussed, first, within the Congress and then in the United Democratic Front (UDF) coordination committee, Sudheeran contended. Sudheeran has also asked the CM not to include the low alcohol tax rate cut in the Finance Bill. Once the budget is passed, the Bacardi company can move the court on the issue and get a favourable order. That should be avoided at any cost, Sudheeran has argued,
Unfortunately, the CM has not responded, so far, to his pointed request. Any vacillation on the issue would only strengthen the suspicions of the people that the Chief Minister has a personal interest in the matter. The UDF is expected to have a discussion on the controversial issue in the first week of July. So far,
The tax rate cut, if it comes into force, will benefit only the private liquor company. Bacardi. Significantly, Satheesan had met the Adani group officials a few days before he became the Kerala Chief Minister. The exchequer will lose around Rs 600 crore because of the tax cut. The lone beneficiary of the tax cut – from 251% to 120 per cent – will be Bacardi.
The Chief Minister has not explained, so far, why he announced the tax cut in such unseemly hurry bypassing his party, the Cabinet and the allies.
The Opposition parties have promptly pounced on the issue to grill Satheesan. The CPI(M) has countered Satheesan’s attempt to blame the previous Left Democratic Front (LDF) Government for precipitating the crisis. It was the LDF Government, which decided to introduce the low alcohol category beverage. But he conveniently forgot to mention that the LDF Government refused to oblige Bacardi which had approached it with a request that they be allowed to manufacture the low alcohol beverage in the State. It sat tight on the file for over three years. It was only after the UDF Government assumed power that the file gathered lightning speed. The file reached the table of Satheesan just three days after he took charge as the CM! He has steadfastly refused to answer the question what was the crying need for lowering the tax.
Sudheeran was not the only Congress leader who challenged the decision. Excise Minister M. Liju has also come out openly against Satheesan’s move. Liju, who was kept in the dark about the decision, is on record that the last word has not been said on the issue. In an apparent criticism of the CM’s unilateral decision, Liju said the final word on the sale of low alcohol liquor will be the liquor policy. And only after the UDF Government comes out with a comprehensive liquor policy will a final decision in the matter be taken. The tax rate cut announced by Satheesan is not for immediate sales, but that these will be the slabs when the sales happen in the future after the liquor policy comes into force, he added.
The issue has put the Indian Union Muslim League (IUML), the second most important constituent of the UDF, in a quandary. IUML leaders including P. K. Kunhalikutty and K. M. Shaji, who are against the tax cut, have changed their stand. The grapevine has it that this is because the IUML ministers are scared of a possible Enforcement Directorate(ED) probe against them.
An unfortunate consequence of the Satheesan decision is the halt in the production of the popular Jawan liquor at the Public Sector unit Travancore Sugars and Chemicals Limited (TSCL). The Excise Minister has since issued instructions to restart production and to calculate the loss due to the stoppage. Action will be taken against those responsible, Liju stated.
Meanwhile, former law minister and senior CPI(M) leader A. K. Balan has written to Speaker Thiruvanchoor Radhakrishnan urging him not to allow the passing of the Budget. The Chief Minister should have referred the sensitive issue to the Subject Committee as is the normal practice and not to the UDF. That act is a violation of the norms governing the conduct of legislative business, Balan contended.
At the end of the day, it can safely be concluded that the UDF meeting will be stormy. If the meeting clears the Chief Minister’s proposals, the decision could trigger trouble for Chief Minister Satheesan, who has come under increasing criticism over his ‘one-man- show and arbitrary style of functioning. If the meeting puts its feet down and forces the CM to reverse the decision, then Satheesan would end up with egg on his face. Either way, difficult days are ahead for Chief Minister Vadassery Damodara Menon Satheesan! (IPA Service)
