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The GST is expected to subsume most of the taxes levied
by the Centre like central excise and service tax, and
those charged by the states such as VAT, purchase tax,
octroi and others.
However, a finance ministry official said, "Some states
like Punjab and Haryana are opposing this as they do not
want to remove the purchase tax on agricultural products
as they are a major source of income for them while
others like Maharashtra do not want to do away with
octroi."
Purchase tax is levied by some states on agricutural
produce when purchased from the state and taken to some
other state, while octroi is levied on various articles
brought into a district for consumption.
Moreover, states are worried about their fiscal autonomy
as there is an unsaid distrust between the Centre and
the states on financial matters.
Source
: Economic
Times, India, dated 27/09/2009
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