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VAT panel submits proposal to Kelkar task force

The Empowered Committee on value-added tax submitted, on Thursday, its proposal on the nationwide tax regime to the Kelkar task force, which is finalising the proposals for reforming direct and indirect tax system.

The committee, headed by West Bengal Finance Minister Asim Dasgupta, also briefed the task force about the level of preparedness by the states on implementing VAT from April 2003, official sources told PTI after the meeting.

The Task force on Indirect Taxes, headed by finance minister's advisor Vijay Kelkar, was awaiting the suggestions from the empowered committee before finalising the report, which is expected to be the roadmap to the next Budget.

Dasgupta, however, reiterated the need for compensation in case of loss of revenue by the states while implementing the VAT, which would replace central sales tax in phases.

Centre had earlier assured that the states would be compensated fully if there is any revenue loss.

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