ASSOCHAM urges to bring imported goods

New Delhi, May 31: Industry body ASSOCHAM today urged the Empowered Committee of all state finance ministers to bring all imported goods, meant for personal consumption and not used for resale, under VAT regime.

''Under current VAT rules, imported goods used for personal consumption are exempt from VAT levy and therefore make domestic market vulnerable for overseas goods,''ASSOCHAM President Venugopal N Dhoot said.

The imported goods directly consumed on import without entering the local trade are not covered either by state VAT or by CST whereas locally produced goods suffer state tax, the industry body pointed out.

The chamber said that goods imported through various dealers are only subjected to VAT levy while mass imports for personal consumption escape it.

Mr Dhoot emphasised the need for introducing uniform state GST from VAT so that uniformity in the tax structure is retained for ensuring better tax compliance. Variations in tax system do not allow creation of common market.

The body has pointed out that at present state VAT does not cover certain sectors like textiles, sugar and tobacco products.

These products are charged separate duty in lieu of VAT which is not vat-able.

Consequently, if these indigenous products are used as inputs, the goods produced with such local inputs like garments and food products will suffer competitive disadvantage in the international market. These non-vat-able special duties should be merged in state VAT, the chamber added.

UNI