States not implementing VAT will suffer
States not implementing VAT will suffer
The Confederation of Indian Industry today cautioned states withholding implementation of the value added tax (VAT) system, saying that they would lose out once trade based on it flourishes.“VAT is a good and forward-looking concept. The states which do not implement it will ultimately be the sufferers”, CII (northern region) chairman, Mr Ajay S Shriram told newspersons here.
“VAT is something which is to be looked into holistically. The CII will work together with the government and members to seek its implementation,” he added.
The official, nevertheless, agreed there was confusion on the procedural front in VAT implementation. However, the CII has it taken up with the empowered committee at the national level and the matter was sought to be sorted out.
He favoured implementation of the VAT uniformly in the country so that it would simplify the tax structure.
In reply to a question, Mr Shriram said the government should clarify its stand on the central sales tax in the wake of the VAT coming into effect from this month.
Stating that the CII will play a key role in trade with Pakistan in the future, he said as a dialogue process between India and Pakistan was continuing. He expressed the hope that many sectors will open up for trade with the neighbouring country.
Having about $ 200 million direct trade with Islamabad, “We can have a lot of business interaction with Pakistan” in agriculture, small sector, textiles and sugar among others, he added.
Underlining the priorities during the current year, the official called for establishing a common economic zone in the North and abolishing multiple tax structure to facilitate freedom in movement of goods within the state and the rest of the country.
Establishing profesionally-managed infrastructure development funds at the state level, streamlining of state finances, e-governance and social development are other priorities with focus on industrial competitiveness, agriculture competitiveness and business development.
More: navhindtimes.com
VAT panel not to introduce new rate for 3 months
VAT panel not to introduce new rate for 3 months
THE Empowered Committee of State Finance Ministers on value-added tax (VAT) does not favour, for now, the introduction of a new VAT rate between 4 and 12.5 per cent.
This position of the VAT panel has been conveyed to the Delhi Government, which had been pitching for an 8 per cent VAT rate.
“It was decided that at least for the next three months, the Empowered Committee would not consider introduction of any new rate,” Mr Ramesh Chandra, Member Secretary of the Empowered Committee, told Business Line.
Under the current VAT system, covering about 550 goods, there are only two basic VAT rates of 4 per cent and 12.5 per cent. There is also a specific category of tax-exempted goods and a special VAT rate of 1 per cent only for gold and silver ornaments.
Admitting that prices of certain items that had moved from, say, the earlier 8 per cent to the VAT rate of 12.5 per cent could go up, Mr Chandra said that the Empowered Committee hoped the effect of the additional 4.5 per cent would get largely mitigated through the “set off” that would be available under the new tax system.
More: thehindubusinessline.com