With the announcement of the sales tax relief, the proposed increase of Rs 20 crore in sales tax in the 1998-99 budget will now be reduced to Rs 15 crore. Vala also announced reduction in purchase tax from six per cent to four per cent on raw materials.

Making the announcement while moving the Appropriation Bill in the Assembly, Vala said he was withdrawing the proposal because the industry felt it would make their products uncompetitive. He also announced withdrawal of the proposal to abolish form 19, as it helped manufacturers purchase raw materials without payment of tax.

The Appropriation Bill, allowing the government to withdraw Rs 12,042.85 crore from the Consolidated Fund during the current financial year, was later passed by the House without debate in the absence of the opposition, which boycotted the proceedings for the second consecutive day in protest against suspension of two members last Friday.

The House was then adjourned by Speaker Dhirubai Shah.