Pre Budget Discussion with Hon Finance Minister
Introduction:
The President of the All Kerala Distributors Association (AKDA) Sri Mujeebur Rahuman recently participated in a crucial pre-budget discussion with the Hon Finance Minister of Kerala Sri KN Balagopal, highlighting pressing tax-related concerns faced by distributors. The discussion shed light on the detrimental impact of unethical practices by parallel suppliers, as well as the significant tax losses incurred by the government due to price undercutting and predatory pricing by corporate and online giants.
Background:
The distribution sector in Kerala plays a vital role in the state's economy, contributing significantly to employment and revenue. The AKDA, representing the interests of distributors, has been proactive in advocating for fair practices and addressing challenges faced by its members.
Tax-related Issues:
During the discussion, the AKDA President Mr.Mujeebur Rahuman emphasized the need to address tax-related challenges affecting distributors in the state. High tax rates, complex compliance procedures, and inconsistent tax policies were identified as major impediments to the growth of the distribution sector. The President presented concrete examples illustrating how these issues hindered the efficiency and profitability of distributors, leading to a cascading effect on the overall business environment.
Unethical Practices of Parallel Suppliers:
One of the key issues raised was the prevalence of unethical practices by parallel suppliers. The AKDA President highlighted instances where distributors were grappling with the infiltration of substandard and counterfeit products into the market, resulting in reputational damage and financial losses. These malpractices not only harm distributors but also compromise consumer trust and safety.
Tax Losses due to Price Undercutting:
Another critical point of discussion focused on the tax losses incurred by the government due to price undercutting and predatory pricing by corporate and online giants. The AKDA President presented compelling data showcasing how these entities, often backed by substantial resources, engage in aggressive pricing strategies that not only squeeze the profit margins of distributors but also lead to reduced tax revenues for the government. Addressing this issue was deemed essential to ensuring a level playing field for all market participants.
Proposed Solutions:
In the spirit of collaboration, the AKDA President suggested several measures to mitigate these challenges. These included a review of existing tax structures to make them more equitable, streamlining compliance processes, and implementing stringent measures against parallel suppliers engaging in unethical practices. Additionally, the need for a comprehensive framework to curb price undercutting and ensure fair competition was underscored.
Conclusion:
The pre-budget discussion between the AKDA President and the Finance Minister of Kerala served as a significant platform for addressing critical issues faced by distributors in the state. By shining a spotlight on tax-related challenges, unethical practices of parallel suppliers, and the tax losses resulting from price undercutting, the discussion aimed to pave the way for a more inclusive and sustainable business environment. The outcomes of this dialogue are eagerly awaited as stakeholders anticipate positive changes that will foster growth, innovation, and fair competition in the distribution sector in Kerala.