The Hindu : Andhra Pradesh News : Ordinance on VAT on January 20

Online edition of India's National Newspaper
Tuesday, Dec 21, 2004

Andhra Pradesh

Andhra Pradesh

Ordinance on VAT on January 20

By Our Special Correspondent

HYDERABAD, DEC.20. With the decks getting cleared for implementation of the new VAT regime from April next, the State Government will promulgate an ordinance on January 20.

This was told to reporters by the Commercial Taxes Minister, Konathala Ramakrishna, after inaugurating a State-level conference of Deputy Commissioners here on Monday. He said the Central Sales Tax would continue for two years and would be phased out after VAT stabilised. "We are thinking of phasing it out in the third year," he added.

Meet with traders

He said that a draft of the new VAT bill containing simplified procedures would be circulated among traders all over the State and their feedback obtained before January 5 for incorporating any amendments. A State-level conference would be held on December 30 for seeking suggestions from traders and chambers of commerce.

Earlier addressing the conference, the Minister said the Centre had agreed to compensate the loss incurred by the State during the initial three years in the post-VAT period at the rate of 100 per cent in the first year, 75 per cent and 50 per cent respectively for the subsequent years. Asking the staff to step up collections, he pointed out that the best growth year in the last five years would be considered for working out the compensation.

Call to officials

Advising officials to be assessee-friendly, he said that about three lakh of the four lakh traders would not come under the VAT system and wanted them to concentrate on "thrust areas" instead of petty traders to ensure increased revenue collections. He said that incentives would be given to efficient officials and action taken against those committing lapses. He announced that 13 officers from the rank of CTO to Deputy Commissioners would be sent abroad in January for training in VAT.

He expressed happiness that his department had achieved a growth rate of 19.92 per cent in collections this year as against an average of 7 to 8 percent during the previous three years.

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