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Traders seek vital changes in VAT

By Our Staff Reporter

NEW DELHI, FEB. 4. The Confederation of All India Traders (CAIT), an apex body of the trading community in the country, has demanded important changes in the proposed Value Added Tax law and has submitted a 14-point charter of amendments to the Chairman of the Empowered Committee of State Finance Ministers on VAT, Asim Das Gupta.

According to the Secretary-General of CAIT, Praveen Khandelwal, the memorandum demands that the Central Sales Tax be abolished as there is no need to carry on with it once VAT is introduced as VAT would be replacing the local sales tax. Also, he said, VAT should be made applicable only to those commodities that are taxable under existing sales tax law.Stating that all items covered under VAT should be harmonised with the Central Excise classification, Mr. Khandelwal said audit by officers should be a decision of the dealer alone on whether he wants to get the audit done at his business premises or at the office of the sales tax officer. Also, he said, the completed or accepted returns should not be allowed to be reopened in any case The memorandum also seeks that the penal provision should not be more than the existing one and that no new penal provision or provision for prosecution should be introduced. Demanding that the limit for registration should be Rs 20 lakhs, it also asks for full input tax credit for purchase of capital goods and calls for this credit to be given in case of purchase of capital goods. Also, he said full input tax credit should be given for tax paid stock lying as on appointed date and if the order of an officer is reserved the first two years should be considered as transitional period and no fine or penalty should be imposed for lapses during this period. Finally, he said, if annual return result is to be refunded, it should be refunded within three months from filing of return.

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