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Evaluation of VAT in Delhi |
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The Empowered Committee has taken steps to initiated for systematic preparation for the introduction of State-level VAT. In order to avoid any unhealthy competition among the States which may lead to distortions in manufacturing and trade, attempts have been made from the very beginning to harmonise the VAT design in the States, keeping also in view the distinctive features of each State and the need for federal flexibility. This has been done by the States collectively agreeing, through repeated discussions in the Empowered Committee, to certain common points of convergence regarding VAT, and allowing at the same time certain flexibility for the local characteristics of the States.
Delhi Sales Tax Department (DST) of the Government of NCT of Delhi is responsible for developing and implementing a comprehensive VAT regime for the National Capital Territory of Delhi. Migration to VAT presents a unique opportunity to re-engineer and IT enable the DST operations. The Dept. has finalised the DGT policy, legislation, rules and regulations, business procedures and organisation structure required to enable the changeover to the new system.
Finally the DST has implemented Value Added Tax (VAT) in Delhi on 01st April, 2005. Initially this system was protested by the trade unions and dealers. However, the department had explained the beauty and flexibility of VAT to the dealers, Trade Unions and Bar council. The Dept. has conducted numerous workshops, conferences and awareness campaigns to bring about an awareness among the stakeholders. The implementation of VAT seeks to achieve a new tax system, which is efficient and taxpayer-friendly. It seeks to reduce the compliance cost for the taxpayers and administrative costs for DST. The new system is also intended to ensure that the patterns of consumption, production and resource use in Delhi do not get distorted by the tax system.
The new tax system DVAT replaces the old Delhi Sales Tax Act, Delhi Sales Tax on Works Contract Act, Delhi Sales Tax on Right to use goods Act and Delhi Sales Tax on entry of motor vehicles.
The department has developed a citizen interface that encourages compliance to the process and ensures digital loyalty. Citizen-centric channels that would provide faster and easier access will be deployed. Considering the sensitivity and confidentiality of information the security policy and appropriate equipment is being planned. The associated infrastructure, software and support services are procured to facilitate the implementation of the application. A robust IT application is being created to support and automate the defined processes. The base processes and organizational structures have been redefined to facilitate the implementation of the new regime.
The Dept. intends to further refine the structure, the audit policies, employee training and the communication process to solve the implementation problem.
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Local Services 