JCB call for stronger VAT implementation across India

JCB chairman Sir Anthony Bamford highlighted the importance of harmonizing VAT taxation across all of India’s states at a meeting with Indian Prime Minister Dr Manmohan Singh and Rt Hon. Tony Blair MP at 10 Downing Street last week.

India is now JCB’s second largest global market and the company says the lack of uniformity of VAT is a growing concern. A number of Indian states have still not introduced the tax, which should have been implemented across the country by 1 April 2005, and the uncertainty has been exacerbated by one state unilaterally raising the statutory rate for some goods.

Sir Anthony stressed the importance of a stable taxation structure as an important basis for global companies to continue their significant investment in India. He said: ‘India’s economic growth is truly impressive, but we are looking to Prime Minister Dr Singh for reassurance that India will have the stable taxation structure which is so important for growth and business confidence.’

JCB have three plants in India and the recent opening of the new £15 million JCB Manufacturing Ltd factory in Pune is part of an overall £40 million investment in the company’s Indian operations.

JCB started backhoe loader production in India in 1980 under a joint-venture business based at Ballabgarh, near Delhi. JCB India was formed in 2003 after the company acquired their Indian partner’s shares in the joint venture.

Since 1980 JCB have sold more than 45,000 machines in India, with one in every two machines sold in the country being made by the company. JCB India are now the largest construction equipment manufacturers in India and this year sales are expected to hit a new record.

JCB managing director and CEO John Patterson said: ‘India is now our second largest global market and sales there have quadrupled in the last five years. As market leader in India, it is important that we continue to invest heavily to keep pace with the growth we anticipate in the future.’