Delhi chief minister Arvind Kejriwal has announced his government’s decision to roll back the proposed imposition of VAT on textile and low-cost shoes after protests from traders and MLAs.

Deputy chief minister Manish Sisodia while presenting the state Budget, had proposed rationalisation of tax on textiles and fabrics by applying uniform tax of five per cent on all varieties, including sarees, except khadi and handloom.

Kejriwal said within 24 hours of tabling the Budget, the government reversed its decision to impose VAT on textile and shoes priced below Rs 500. He claimed that his government took fast decisions.

“On Monday, we presented budget and yesterday, traders raised their issues before us and today, we withdrew our decision. We accepted our mistake after meeting a delegation of cloth traders. Our government is proactive which takes fast decision in view of people’s welfare,” Kejriwal said in the Assembly.

The government’s decision was also forced by MLAs who opposed the imposition of VAT. During a discussion in the Assembly, Leader of Opposition Vijender Gupta and at least three AAP MLAs opposed the government’s decision to impose VAT on textile and shoes costing below Rs 500.

AAP MLA Anil Vajpayee said his Gandhi Nagar constituency houses cloth traders where around 10 lakh people are employed. He said there is no VAT on neighbouring states in Haryana and Uttar Pradesh and expressed fears that these traders could move to Noida, Ghaziabad, Faridabad for doing business if VAT wasn’t rolled back.