Future of Sales Tax

Future of Sales Tax THE appointment of the Indirect Taxation Enquiry Committee, whose recommendations are expected to initiate a new stage in the evolution of our tax system,1 triggered off intense public debate on the entire gamut of indirect taxation. Befitting its position as the premier indirect tax levied by the states, the sales tax is having its due share of the limelight. The multiplicity of state sales tax laws and the diversity of rates could never be popular with those purists of public finance who figure efficiency and uniformity; nor Were they popular with the industry and trade, even when the demand for manufactured goods seemed limitless, regardless of price, quality or incidence of tax. No wonder that in the several workshops and technical sessions being held to discuss the indirect taxes, far- reaching suggestions to basically alter the nature of the sales tax levy are being made. The publication of the reports of the Gulati6 and Lakdawalal Committees, which critically review sales taxation in Kerala and Uttar Pradesh, could not therefore have been at a more opportune time.