'Govt for flexible approach on VAT'

Terming the decision of the BJP-ruled states against the implementation of VAT from April 1, 2005, as just a political move without any valid administrative reasons, Andhra Pradesh commercial taxes minister Konatala Ramakrishna said that his government will be flexible enough to address any problems faced by the traders in the post-VAT scenario.

Speaking to Business Standard, the minister said that his department would further streamline the tax refund mechanism as envisaged in VAT so that the assessees under the new tax system can access the facility at the earliest.

He observed that both the trader and the investor will gain from the new tax regime.

"Industry, especially the manufacturing sector, will gain enormously from the Input Tax Credit to be made available under VAT. These sectors, however, will be put in a disadvantageous position wherever VAT is not being implemented," the minister said adding that it is bound to be implemented even by those states who are now refusing to switch over to the new tax system.

According to him, VAT ushers in a couple of qualitative changes in the domain of tax collection.

"My department, which acts as a regulator besides collecting taxes, will play only a facilitator's role after April 1, 2005. Moreover, mutual trust and confidence between the business community and the department will grow to a level of friendly relations with the self-assessment clause provided in the VAT Act. The new tax regime will also make the assessees feel more at home," the minister said.

The minister said that through VAT, he is also aiming at giving a face-lift to the commercial taxes department and making it more professional.

"Problems are likely to crop up. But we are not rigid. The government will deal with such problems in a flexible manner," the minister assured the traders.