Mamata gives Centre 15-day ultimatum on tax moratorium

Kolkata, April 21 (IANS) Reiterating her demand for an interest moratorium for the cash-strapped West Bengal government, Chief Minister Mamata Banerjee Saturday gave the central government a 15-day ultimatum and warned that its "indifferent attitude" could become a "big issue".

"We have not enough income to pay the interest for the debt burden bequeathed by the erstwhile (Left Front) government. We are repeatedly urging (the central government) that we do not need its mercy, but that it should provide us at least a three-year interest moratorium. They should give us the moratorium as we are unable to pay it," Banejee said during a programme here.

She also took a dig at the centre for deducting Rs.15 billion from the state's share of Central Sales Tax (CST) compensation.

"We have been waiting for one year. But enough is enough. The centre has also deducted Rs.1,500 crore from our share of CST compensation. On the one hand, it is cutting Rs.22,000 crore as interest, and on the other it is deducting Rs.1,500 crore from CST compensation. It means the centre is making the state government debt-ridden to ensure that it cannot function," she stated.

"I will certainly not tolerate it," the chief minister warned and gave the Congress-led United Progressive Alliance (UPA) government 15 days to decide on the interest freeze for three years.

"I am still appealing to the centre, but if it continues to remain indifferent, then it will be a big issue. I will still wait for 15 days. I have earlier called on the Prime Minister and met with the finance minister several times, but till now we have not received any funds," Banerjee stated.

She recently said the debt burden bequeathed by the erstwhile Left Front government in the state could be more than the estimated Rs.2.3 lakh crore. The state government's current annual outgo on interest payments is around Rs.2,200 crore.

Banerjee has also been insisting that since the new government has inherited this huge quantum of debt burden, the central government should find a way to waive these loans or settle the debt.

The Trinamool Congress with 19 members in the Lok Sabha and 6 members in the Rajya Sabha is the second largest constituent of the ruling UPA II.

Currently, the relationship between the Congress and the Trinamool is going through a rough patch after the Trinamool openly opposed various policies of the central government.