The India operates one of the most complex and inefficient consumption tax regimes in the world. There are a number of taxes, including: • Indian VAT levied on goods separately by most of the 29 Indian states; • Indian Service Tax which is charged on services • CENVAT a VAT on the supply of goods charged by the central government • Professional Tax The taxes often overlap, resulting in double taxation, and impose a heavy administrative burden on taxable persons. There is also limited scope for the recovery of VAT, resulting in spiralling compound tax. It is estimated that the consolidated tax burden on the economy is over 30% compared to the OECD average of less than 20%.All of these factors act as a drag on the Indian economy – certainly costing the country 1% GDP growth per annum. There is also a narrow and unstable tax base with the current regime, which leads to unpredictable variations in government revenues. Other emerging countries have also introduced plans to reform their tax systems, and are much further down the line than India like Chinese VAT reform and Malaysia introduces GST.