Bhopal: The Madhya Pradesh government has decided to withdraw Value Added Tax (VAT) on mobile recharge vouchers. The state government would soon bring in an ordinance to withdraw the tax.

The state government decided to do way with the tax after representatives of the Association of Mobile Voucher Merchants met the Chief Minister and apprised him of their problems.

With MP being the only state charging extra tax on recharge vouchers, the retailers of the state were forced to stop its sale.

The representatives informed the CM that Madhya Pradesh is the only state which charges VAT on recharge coupons. The decision was taken by the Commercial Tax Commissioner despite the fact that the Supreme Court has termed vouchers as a service and not a product.

Taking a serious note of the issue, the CM assured the Association of disposing the extra charges on vouchers.

Rajesh Jain, state president of Udyog Vyapar Mandal, Sharikh Khan, president of Bhopal Telecom Distributors Association and Secretary Tikam Lokvani informed that the CM has confirmed that Income Tax department will not charge VAT from any of the retailers.

The process to issue an ordinance for cancelling the order passed by the Commissioner has already begun.