Bowing to demands of small traders and entrepreneurs, the Bihar government has decided to enhance the annual turnover limit for mandatory VAT audit from Rs 40 lakh to Rs 1 crore.
According to the VAT Act, 2005, it was mandatory for every dealer whose annual turnover exceeded Rs 40 lakh to get his accounts audited by a chartered accountant before December 31 every year. This was, however, opposed by small dealers who pressed for amendment to the existing Act so that the exercise became less cumbersome.
The Bihar Chamber of Commerce welcomed the move and said it would be of immense help to small ventures, particularly such units, which are engaged in business in towns other than the state capital.
"Getting their books of account audited by CAs was very demanding for small traders as the whole exercise was not only cumbersome but also expensive. States like West Bengal and Gujarat also had such a VAT policy in place and it was therefore in the fitness of things that Bihar too raised the limit," the chamber said.
Deputy chief minister Sushil Kumar Modi, who is also in charge of finance, said the government took the step to promote small business ventures in the state.