SOUTH AFRICA-Undeserved Credit

the union and the states. It would appear, however, that the committee got carried away by its enthusiasm for the changeover The constitutional hurdles might not be as easy to overcome as the committee gave the government to understand. This comes out not only from the proposals forwarded by the National Institute of Public Finance and Policy (NIPFP), the institute commissioned by the government to come up with a concrete measure; the deliberations of the one- day conference should also have convinced the finance ministry how hard it will be to bridge the gap between the centre and the states on the subject. AN that has been agreed upon (if at all it can be so described) is to set up a committee to go into the question of value added taxation. The NIPFP had reportedly cautioned against a national-level value added tax and has instead suggested a two-level levy, one at the central level and the other at the state level, each with its own offset provisions in regard to input taxation at the respective level, but with no provision for cross-offsets.