Raipur, Feb 25: The Chhattisgarh government today (Feb, 25, 2006) announced to switch over to Value Added Tax (VAT) regime from April 1 and to exempt many items from VAT in the Rs 223.22 crore deficit budget for 2006-07, which was presented by Finance Minister Amar Agrawal in the Assembly.
''Introduction of VAT regime would help facilitate a uniform tax structure throughout the country'', Mr Agrawal said to the House.
''The state was ready to switch over to VAT regime much earlier but it could not be introduced as the policy for compensating the states for the revenue loss on account of Central Sales Tax was not clear. We are hopeful that the centre would compensate for the losses on this account'', he added.
Mr Agrawal announced to exempt many items, including agarbatti, coconut, wheat flour, kosa yarn and cocoon of all types, from VAT and to keep grocery items in four per cent VAT.
Similarly fly ash bricks have been exempted from VAT, he added.
VAT rate on all electrical wires and cables would be brought down to four per cent from 12.5 per cent in view of the extension of electrical infrastructure and rural electrification programme being carried out in the state, he added.