The Hindu Business Line : VAT assignments cheer consultants, accounting firms

Inundated by frantic calls from clients, they have come up with innovative solutions — including `VAT calculators', special VAT-compliant `software patches' and customised warehousing strategies — for assisting companies to manage the transition.

For instance, consulting firm Positron Advisory Services has developed a `VAT calculator', which can calculate the overall tax incidence for a company following the transition to the VAT regime and can be used across sectors.

Positron is working with a number of clients, mostly inthe manufacturing space. "All the basic formulae have been coded into the software. Clients provide specific data, which is then fed into the calculator. Based on the calculations, the software provides a basic report, which we discuss with the client and a tax strategy is worked out," Mr Abhijeet Virmani, Director at Positron Advisory Services, said.

Consultants are also working overtime with clients on realigning their warehousing strategies. "Many of the bigger FMCG and automobile companies are rethinking their warehousing strategies, with VAT making it feasible for firms to have a consolidated warehousing plan. We are working with a number of clients in this area," an executive with a mid-sized tax-consulting firm said.

Not to be left behind, leading financial accounting software company, Tally Solutions is working with several firms for upgrading their accounting software to make it VAT compliant. The company, which had worked with a large number of firms in the UK to become VAT compliant, is also conducting relevant training for chartered accountants and hardware resellers across the country.

Consulting companies are also working with several of the State Governments, assisting them to draft the legislations and seeing through the transition.

"Despite the run-up to the VAT regime happening the third time in succession, there is adequate amount of confusion among stakeholders. While the Union Government's recent "White paper on VAT" only gives a broad structure of the new tax regime, it is short on details. We are using whatever information is available in the general domain to advise clients," a consultant said.

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