Articles by Mahesh C Purohit

The objective of this study is to compare relative tax effort and taxable capacity of the central government in India with the average tax effort of other similar countries. The study also compares the tax effort and taxable capacity of the state governments with the average tax effort of all the states in India. Various determinants of tax bases have been selected to estimate the average rate and taxable effort as well as the taxable capacity of the states. The results indicate that during the period 2000 to 2003 Gujarat ranked first in this regard, with West Bengal and Andhra Pradesh in the second and third places respectively.

Brazil has the distinction of being the only federal country in the world with independent value added taxes (VATs) at the federal and state levels. This paper seeks to present the salient features of the structure of the VATs in Brazil and to discuss issues related to the management of the state VATs in that country.

Mahesh C Purohit While the last budget, primarily aimed at reforms, extended MODVAT considerably by including petroleum products, capital goods and the yarn component of the textile sector within its purview, the 1995-96 Budget proposes to mop up resources by increasing the tax rate of two select commodities, cigarettes and cement. This article attempts to look at the likely implications of the budget proposals, by focusing on the tobacco sector.

The budget follows the policy of high fiscal deficit to boost the economy. It may be worth the risk provided the supply side responds adequately. The budget has based this assertion on the claim that it has taken a leap forward towards a rational tax policy: This paper challenges this claim and presents an analysis of reforms in the union excise duties for textile sector as a case study. It delves into the priorities as well as the pace of reforms. The paper puts forth proposals for reforms essential to provide an environment conducive to a proper response from the supply side.

The Forty-Sixth Constitutional Amendment Act has authorised the central government to levy tax on consignment transfers. This would mean that whereas hitherto the CST was levied on about approximately 10 per cent of the transactions, it would now cover all interstate transactions. It is, therefore, necessary that in the interest of the greater degree of autonomy for the states, and for a unified common federal market in the country, the fiscal frontiers of the CST should be shifted from exporting borders to the consuming outlets. This would imply that the basis of the CST would be shifted from origin to destination. What is the rationale of such a shift?