Delhi government on Tuesday amended the Value Added Tax (VAT) Act allowing traders a reprieve from “forced refunds” at the end of a financial year.
The amendment is also meant to encourage them to pay more tax.
Deputy Chief Minister Manish Sisodia said, “This was a major demand of traders which we have fulfilled today.”
“The traders were earlier forced to claim refund on the Input Tax paid by them before the end of each financial year,” he said.
“This was a cumbersome process and traders faced the apprehension of lapse of any refund amount,” he added.
Dip in revenue
The amendment will also save the Delhi government from a hefty payout in the form of refunds to the traders in the last month of the financial year, in which the revenue collection has dipped by over Rs 4,000 crore.
Traders have been an important vote bank for the Aam Aadmi Party.
Chief Minister Arvind Kejriwal wants to keep the traders’ lobby happy and he indicated this when, soon after being sworn in, he announced discontinuation of raids on them. But he also urged them to file their returns.
In his first speech at Ramlila Maidan, Arvind Kejriwal promised traders that they will not be bothered by inspectors from the AAP government. But in return they will have to file their taxes in large numbers.
The Chief Minister also assured the traders that he would ensure that every penny that they pay as tax would be used for constructing colleges, hospitals, schools and giving relief in power and water bills.
