VAT implementation as scheduled: Minister

S.N.M. Ubayadullah

S.N.M. Ubayadullah  

Special Correspondent

Traders asked to obtain Tax Payers Identification Number

CHENNAI: Commercial Taxes Minister S.N.M. Ubayadullah on Wednesday confirmed that the State would adopt the Value Added Tax regime from January 1, 2007.

The draft notification has been published (and is also available at the website >www.tnsalestax.gov.in) and a gazette notification has been issued.


The draft will come up for discussion in the State Assembly. (The Assembly session begins on December 4.)

Addressing presspersons here, he requested traders to obtain the Tax Payers Identification Number. This facility was available online from Wednesday. All the 3.9 lakh traders under the purview of the Tamil Nadu General Sales Tax should apply for this 11-digit number.

The traders have to apply and register under VAT. For this too, an online facility was available. Once the law was enacted, traders would be given the VAT registration details by post.

The Minister said the State was preparing itself to implement VAT. Training of officials and staff was on and trader awareness would be taken up soon.

The Minister said the State expected the Central compensation to be 75 per cent of its estimated revenue loss. This loss was expected to be about Rs.3,000 crore.

High taxation rates

Tamil Nadu had high rates of taxation for some commodities and once VAT was in place, the State's revenue collection would only go down, unlike many other States. In the VAT regime, the highest tax was 12 per cent, whereas the State now had many items taxed at 16 per cent.

All these would end up in one of three VAT rate slabs one per cent, four per cent or 12 per cent.

Revenue growth

The State had recorded a 20 per cent revenue growth from April to end-October. This year, the total revenue for the period stood at Rs.11,300 crore.

Commercial Taxes Commissioner S. Malathi said the response to the samadhan scheme was poor. The total tax arrears, including those under litigation, was about Rs.8,000 crore.

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