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Govt for uniform VAT in all states between 0-4 pc: Sahai
November, 14th 2008

The Government is endeavouring to bring about uniform value added tax (VAT) in all states at between 0-4 per cent which would benefit the food processing industry, a senior Central Government Minister said.

"The Central Government has made zero excise duty. In the case of VAT, it was supposed to be uniform in all states but different products attract different rates in different states," Minister of State for Food Processing Industries, Subodh Kant Sahai, told reporters on the sidelines of the 'Food World India 2008' event, here today.

"Currently, it is in categories of 0 per cent, 4, 8 and 12.5 per cent. We request all states to bring uniformity in VAT -- it should be somewhere between 0-4 per cent.

This would benefit the industry and would result in growth," he added. The USD 200 billion food processing industry has been clamouring for an uniform Value Added Tax (VAT) regime in all states that would result in the overall growth of the industry.

Sahai said that the food processing industry in the country has not been affected by the global meltdown but was instead growing.

"The recession has not affected the food processing industry as compared to other sectors. Instead, investors are still interested in investing in this sector," Sahai said.

The relationship between industry, farmers and retailers needed to be strengthened as this would enable the sector to grow rapidly, he said.

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