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"We are better prepared this time round. All the bottlenecks have been identified. The Empowered Committee has been asked to prepare a new roadmap for introduction of VAT," Mr Satish Chandra said.

New Delhi , Nov. 14

FOR all those sceptics of value-added tax (VAT) regime, here is some bad news.

The Centre on Friday reiterated its commitment to the introduction of a VAT regime in the country even while refraining from offering a commitment on the timeframe for implementation.

"We are better prepared this time round. All the bottlenecks have been identified. The Empowered Committee has been asked to prepare a new roadmap for introduction of VAT," Mr Satish Chandra, Additional Secretary (Revenue), Finance Ministry, said here at an international conference on "Investment Friendly Tax and Corporate Law regime," organised by the Federation of Indian Chambers of Commerce and Industry (FICCI).

At the same time, he made it clear that it was for the States to take the lead in the implementation of VAT and that the Centre can only offer its support for the introduction of VAT.

As regards the perspective of the State Governments on the introduction of VAT, Mr Ramesh Chandra, Member Secretary, Empowered Committee of State Finance Ministers on VAT, laid threadbare the problems (including reservation on compensation formula) faced by the State Governments in implementation of VAT. Even though he elaborated on what to expect and what not to expect from the proposed VAT regime, Mr Ramesh Chandra refrained from taking a call on when to expect the introduction of VAT.

"The biggest problem is date of introduction. The biggest enemy of VAT is local politics. But VAT will definitely come. Do not ask me when," he said

He made it clear to industry that the proposed VAT would not be able to take care of the existing octroi duties. "Octroi per se may go, but States nay have entry tax to compensate them for octroi duties. Octroi is an irritant. But there is no consensus on the future of octroi," Mr Ramesh Chandra said.

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