The Hindu : Decision on VAT likely today

Online edition of India's National Newspaper
Tuesday, May 06, 2003

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Decision on VAT likely today

By Our Special Correspondent

NEW DELHI MAY 5. A decision on whether some of the States would go in for implementation of the value added tax (VAT) by June 1 is expected to be finalised after a meeting tomorrow between the empowered committee of the State Finance Ministers and the Union Finance Minister, Jaswant Singh.

After a meeting here today, Asim Dasgupta, convener of the committee and the West Bengal Finance Minister, confirmed the decision to meet Mr. Singh tomorrow, but declined to say whether the June 1 deadline for implementing VAT would be honoured in at least 15 States.

The committee also decided that at least 216 category of goods would be taxed at 12.5 per cent and drew up an exhaustive residuary list of items under this revenue neutral rate.

Though the level of preparedness among the States has been low, the empowered committee intends to implement the new tax system in at least nine States to begin with, despite the Centre's opposition to a "patchwork" approach.

It was pointed out that many other countries in the world had implemented VAT in a phased manner and that could also be the case in India.

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