The Hindu Business Line : Rubber dealers seek clarification on VAT

THE Indian Rubber Dealers Federation has asked the Government to clarify that all grades of rubber appearing under the Code 4001 and in the sub classification of the Value Added Tax (VAT) tax would qualify to be taxed at four per cent.

The federation said here in a statement that different grades of rubber have not been enunciated in the VAT Act, though the commodity has been placed under the Industrial input in the list `B' in Schedule 3 under Code 4001.

"Though in Code 4001 there are various sub classifications which are notified, these do not appear in the list," the Federation said. Besides, scrap rubber is omitted from the schedule it should also be included in the list.

The federation said the Government should refund within one month the four per cent VAT to be paid by exporters as against the present provision of refund after six months.

"Such delay in refunding will hinder export efforts as heavy amount has to be blocked by exporters on account of tax," it said.

On the move to impose a 12.65 per cent purchase tax on the closing stock with the dealers, the dealers urged the Government to withdraw the move since the small rubber traders, who so far had no tax liability under the Kerala State Sales Tax Act, are forced to pay tax.

If VAT is imposed on the rubber trade at the first point of purchase as envisaged now, the process of tax collection would become extremely difficult as some 8,000 traders, most of whom never had to pay the tax under the KGST Act, will suddenly be liable to pay tax.

In order to avoid such a situation, the federation said the VAT Act should be amended to facilitate tax collection only from the existing 200 odd assesses by imposing the tax on the last point of purchase within the State.

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Onion heading for record production

Rubber dealers seek clarification on VAT

Dusts in demand at Kochi tea sale

Upward tweak likely in cotton

Speculative buying seen lifting global grain prices

Contaminated chilli powder entered UK in 2002: FSA