Chidambaram urges UP to implement VAT

New Delhi, May 23 (UNI) Finance Minister P Chidambaram today urged the Uttar Pradesh government to introduce Value Added Tax (VAT) in the state as soon as possible, saying it was definitely a much better form of taxation than sales tax.

Once the states that have not introduced VAT accepted it, they would realise its advantages, Mr Chidambaram said replying to supplementaries in the Rajya Sabha during question hour.

The Minister said VAT was entirely a state subject, and the central government was playing the role of a facilitator in this process by providing all necessary technical and financial support.

He said so far 30 states and Union Territories had implemented VAT. Uttar Pradesh, Tamil Nadu and the Union Territory of Pondicherry were the only ones which were yet to accept it. The Andaman and Nicobar Islands and Lakshdweep do not levy any sales tax or VAT.

Accepting that there were some aberrations as far as the rate of VAT was concerned, he said an empowered Group of Ministers was working on adoption of a uniform VAT rate throughout the country.

''We are persuading states through the GoM to adopt the uniform rate,'' he said.

Replying to another supplementary, the Finance Minister said a roadmap was being drawn up for introducing uniform Goods and Services Tax (GST), in the absence of which there was a perception of double taxation.

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