The Hindu Business Line : Trade bodies not too keen on VAT launch

The chambers of commerce have stated that "if other States are reluctant to implement VAT simultaneously, trade and industry in the State will be in a disadvantageous position." However, trade bodies like the Hooghly Chamber of Commerce and Federation of West Bengal Trade Associations have vehemently opposed implementation of VAT in West Bengal from April 1, which was announced by the State Finance Minister, Dr Asim Dasgupta, in the Assembly on Monday while presenting the State Budget for 2005-06.

According to Mr P. R. Agarwala, Senior Vice-President of Bharat Chamber of Commerce, the confusion about VAT implementation throughout the country should be removed before switching over to the new system. He said the expected withdrawal of other State taxes/levies has not been announced in the Budget.

The State Finance Minister, expressing surprise at the sudden decision of the BJP States not to implement VAT from April 1, said here that these States had been best prepared for VAT implementation, adding that it was unfortunate that they were going back on the decision. He said a VAT review meeting has been called on Thursday in Delhi wherein the State Finance Ministers would discuss the implementation. The reluctant States would be persuaded to join the VAT brigade, he pointed out.

With the problem of Central Sales Tax not being addressed and States like Uttar Pradesh, Gujarat, Rajasthan and Tamil Nadu not opting for VAT, Mr Aditya V. Agarwal, President of the Merchants Chamber of Commerce, wondered if it would be in the interest of trade and industry to work under the new system.

Mr Anup Singh, President of Indian Chamber of Commerce, welcomed the decision to continue the industrial incentive scheme even after the introduction of VAT. He expressed the hope that all States will simultaneously adopt the new system "so that we can have a single uniform market in place in the country".

Mr Amar Nath Paul, Hon. General Secretary, Hooghly Chamber of Commerce and Hon. Joint GS, Federation of West Bengal Trade Associations, described VAT as trade-unfriendly, and said it would hike the price of essential commodities, affecting both the poor and the middle class population. VAT, according to him, meant "Vanish All Traders" (it will make the business community vanish).

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