The Hindu : Andhra Pradesh News : State against revamp of tax structure: Minister

Online edition of India's National Newspaper
Friday, Aug 06, 2004

Andhra Pradesh

Andhra Pradesh

State against revamp of tax structure: Minister

By Our Special Correspondent

HYDERABAD, Aug. 5. The Commercial Taxes Minister, K.Ramakrishna, has reiterated the State Government's opposition to the suggestion to revamp the basic tax structure under the proposed VAT scheme, saying it might not be viable and difficult to implement.

Talking to reporters after inaugurating a State-level conference of Deputy Commissioners of the Commercial Taxes Department, he said that Andhra Pradesh, Tamil Nadu, Karnataka and several other States were against the proposal to include a new tax rate of eight per cent in the already agreed structure and expressed the hope that the empowered committee of Finance Ministers would go by consensus.

Issue under study

He said the State Government had sought a compensation of Rs.1,300 crores for the first year in case VAT was implemented from the next financial year and said that a technical committee constituted by the Centre was studying the issue.

Mr.Ramakrishna said the State Government had set a target of Rs.11,200 crores for the Commercial Taxes Department this year which was 22 per cent more than last year. Though the last three years registered nine per cent growth rate, a 20.33 per cent growth rate was achieved in the first quarter this year. He said that growth rate targets of 20 per cent for rural and 25 per cent for urban areas have been fixed for 2004-05.

CAG findings to be reviewed

On the CAG findings relating to lapses in the Commercial Taxes Department, he said the Government would review and take a decision to rectify them. Earlier, inaugurating the conference, he said the department played a critical role for the Government to implement various developmental programmes, as it contributed 64 per cent of the State's revenues. He urged the officials to improve the efficiency, plug loopholes in evasion and firmly implement the laws, while ensuring that no trader was harassed.

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