Pune hikes octroi to seven percent

Pune

February 11th, 2008

While partners in Maharashtra are fighting for the abolishment of octroi, the
Pune Municipal Corporation (PMC) has increased Octroi from three to seven
percent, leaving many partners unhappy with the situation.

The PMC in a statement said, "As computers are imported from other
foreign countries we have decided to increase octroi on computers and its
peripherals from three to seven percent so that we can protect the interests of
local manufacturers."

Sunil Gugale, President, Computer Media Dealers Association (CMDA) Pune said,
"Computers today have become a necessity and the government is also trying
to help the ITboom by reducing various taxes on it and declaring the year 2007
as the year of broadband and IT. But with this decision of the PMC our profit
margins will decrease further. Already we get profit margins that are around
four percent and the PMC wants to implement seven percent octroi. That is not at
all fair and we have already put our point before the standing commission of PMC.
We will fight for the right of the dealers and we might also go on an indefinite
strike if PMC does not reduce the octroi charged."

Another dealer, Suresh Joshi, Director, Cache Technologies said,
"Customers will have to bear the cost of the increased octroi and this will
make them unhappy. Pune is called the IT-city and such octroi increase will
create problems in the city as people will go to nearby towns like
Pimpri-Chinchwad where IT products are only charged 2.5 octroi."

Another dealer and Director of Shro Systems, Annirudh Shrotriya said,
"Ultimately customers will have to bear the cost. We have some contracts
running and we cannot increase the price right now but we will increase the
price in all upcoming contracts as we have no option left."

Maharashtra is already fighting for the abolishment of Octroi. Various
associations and the Chamber of Commerce have already made presentations to the
government regarding octroi abolishment. Recently, Vilasrao Deshmukh, CM,
Maharashtra also said that he would abolish octroi by mid-2008.