The Hindu Business Line : VAT will bring down prices: Shome

DR Parthasarthi Shome, Advisor to the Union Finance Minister, on Saturday sought to allay fears that implementation of value added tax (VAT) from April 1 would increase prices of commodities and consumer goods.

He told presspersons on the sidelines of a conference on VAT organised by the Bombay Chamber of Commerce and Industry (BCCI) that implementation of VAT would, on the contrary, bring down prices, as taxes on inputs would be eliminated in the VAT regime. Also, the new regime would erase the distortions that exist in the current tax regime, he said, citing the example of South Africa, which recorded an immediate dip in prices after implementation of VAT.

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