In a major breakthrough, all states have agreed to levy a single value added tax (VAT) rate of 12.5 per cent on all items instead of two rates on which they were given an option. This will put an end to the inter-state tax rivalry aimed at attracting business.
The states have also decided against imposing entry tax on goods following the implementation of VAT from April 1.These decisions were taken on Saturday, February 8 at a meeting of the empowered committee of state finance ministers.
The earlier proposal was to give states an option to levy a general VAT rate of 10 per cent or 12.5 per cent. Several exceptions, however, remain
