Bengal to watch post-VAT prices

PMC would suggest realignment of tax rates for a specific commodity is its prices went up under VAT.

"If PMC finds a large increase in price of a certain commodity, it will ask the government to reconsider the tax rate on the product. The government in all probability would reconsider and reduce the tax rate on the commodity to stabilise prices," C M Bachhawat, commissioner of commercial taxes of West Bengal government, announced here today.

Bachhawat was addressing a seminar on VAT organised by the Merchants Chamber of Commerce (MCC).

The PMC would also monitor the prices of commodities is they crashed after the roll-out of VAT.

It would then report to the government on possible remedial action.

Bachhawat claimed today that prices of certain products like paper and cement had already come down as a result of VAT within 13 days of its imposition from April 1.

"Prices of cosmetics and some medicines have also witnessed declines," he added.

Answering queries put forward by traders and manufacturers at MCC, Bachhawat said that the requirement of maintaining records for eight years was being reconsidered by the Bengal state government.

MCC would like it to be brought down to five years.

While explaining West Bengal's stand on the exemption limit which has been fixed at Rs 5 lakh for traders, he said that the intention now was to evolve a formula.

Reacting to a suggestion for change of the definition of gross turnover for taxable items only, he said traders and manuf acturers could expect an announcement soon.

MCC suggested that the provision to allow adjustment of input-tax paid after incentive period for tax remitted goods should be reconsidered.

Bachhawat admitted that the government was likely to grant an exemption in this respect.