‘States to speed up VAT implementation’

Presence of inter-state barriers hamper free flow of goods and services within the country and effected the competitiveness of Indian industry. It is thus essential, states CII that while moving towards a VAT regime these issues are addressed and operating procedures specifically those relating to rate structure, classification of products, set-off mechanism and documentary procedures are uniform across the states. Also wide divergence in the structure and practices would hamper the growth of trade, following creation of artificial barriers leading to complexities, that will reduce the competitiveness of the Indian economy.

CII also calls for the need to unify all taxes levied by the state on goods and services under VAT. With the introduction of VAT, the various state taxes and other local levies such as sales tax, surcharge, luxury tax, turnover tax, entry tax and any other taxes on sale/movement of goods should be abolished. Also the tax on state services should be integrated with the VAT regime.