India To Have Combined GST From 2010

by Philip Morton, Investors Offshore.com

03 December 2007

India is set to undergo a major tax reform over the next three years, as the government and state authorities have agreed to enforce a dual Goods and Services Tax (GST) from April 2010.

This move will ensure that producers and, therefore, consumers of goods are not subjected to double taxation in this area.

According to a Times of India report, Asim Dasgupta, West Bengal's Finance Minister, announced on Thursday that:

"An attempt will be made to subsume or integrate as many taxes on manufacturing and consumption as possible and feasible."

Dasgupta continued: "We will ensure there is no double taxation. The tax rate would depend on the requirements of revenue neutrality, but there may not be only one rate."

Certain local goods and service levies, although not all, as had been hoped, are set to be absorbed by the new tax.

After initial proposals were made in 2004, Central Finance Minister P Chidambaram this year appointed a panel to begin discussion over the matter with states, in order to gain recommendations.

Further consultation is expected to take place between the state and central authorities, following which, rates will be set.

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