The Hindu : Andhra Pradesh News : Ordinance on VAT soon, says Minister

Online edition of India's National Newspaper
Friday, Dec 31, 2004

Andhra Pradesh

Andhra Pradesh

Ordinance on VAT soon, says Minister

By Our Special Correspondent

The Minister for Commercial Taxes, K. Ramakrishna, addressing traders in Hyderabad on Thursday.

HYDERABAD, DEC. 30. The Commercial Taxes Minister, K.Ramakrishna, has said that an ordinance would be promulgated soon to implement the new VAT regime from April next by incorporating, if need be, the changes suggested by the trade bodies.

Speaking at a State-level trade meet on the draft VAT bill here, he said that there were fears among the traders that the new act would be more beneficial to the industry rather than trade. He sought to assure them that it would be more transparent unlike the Andhra Pradesh General Sales Tax Act, which had provided the officials with discretionary powers leading to harassment.

He said the State was making all the preparations for implementing the VAT Act from April next. Advising the Commercial Taxes Department to play the role of facilitator and counsellor rather than that of a regulator as in the past, he said that nearly 3 lakh assessees would not come under the purview of the VAT Act.

Significant growth

Mr. Ramakrishna said the tax revenues had registered a 19.9 per cent growth without the levy of any additional taxes. This showed that there was a lot of potential in this area, he added. The realisation of more revenue would enable the Government to create infrastructure, which in turn would help the trade flourish.

He reiterated that the Government was planning to enhance the allocation to the irrigation sector to Rs.7,000 crores during each of the next four years in order to complete the irrigation projects being taken up at a cost of Rs.46,000 crores. As much as Rs.32,000 crores of the required amount would be met from the Government's budget.

Open mind

Earlier, the Special Chief Secretary, N.S. Hariharan, said the Government would keep an open mind on various issues while implementing VAT although the flexibility had been substantially reduced.

The representatives of various trade associations, including FAPCCI at the State-level and from the districts spoke at the meeting.

CII's plea

The chairman of CII's Andhra Pradesh chapter, Ramesh Datla, wanted a clear time-frame on phasing out the central sales tax and a clear definition on services. He said the provisions of the Act should be framed keeping mind the WTO norms.

The FAPCCI president, O.P. Goenka, said the VAT should be implemented in a transparent manner and urged the Government to clarify on certain `confusions' in the draft bill.

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