TAPMA criticises TN decision to defer VAT

Chennai, June 23: Tamil Nadu Plastics Manufacturers' Association (TAPMA) today said the State Government's reported decision to defer the implementation of Value Added Tax(VAT) to a later date is shocking to their members.

In a press release here TAPMA Hony Secretary Brij Khandelwal said the plastics industry was unable to compete with its neighbouring states, with stiff rates of tax, entry tax and high cost of power, among others.

Mr Khandelwal said there has been no significant new investments in the plastics industry mainly because of deterrent sales tax structure.

The plastics industry in Tamil Nadu consists of mainly small and tiny units, providing employment to uneducated people in the lower strata of the society and the delay in non-implementation of VAT will lead to diversion of capital and business, besides unemployment, he said.

He said the Government can accommodate the expectation of small traders by either allowing them to pay tax at fixed rate or opt for VAT, as in the case of Central Excise.

Mr Khandelwal said the Government can implement VAT for the manufacturers initially and later extent the coverage to other sectors.

This will definitely improve the health of the manufacturing industry in Tamil Nadu, the release added.

UNI