Vol.1,Issue.V/June; 12pp.1-4 Indian Streams Research Journal It applies to all businesses, including importers, exporters, manufacturers, retailers, work contractors. At this moment VAT is the key source of government's revenue in more than 150 countries. Nearly seventy percent of the world is now under the VAT. The past experience in Maharashtra & elsewhere have shown that half backed reforms in the name of VAT has done more harm than good in evolving a tax system required competitive environment. Maharashtra is the third largest state which is contributing 12 percent revenue through VAT to the exchequer in India in 2009-10. It is important to assess the changing scenario of taxation from sales tax to VAT and VAT to GST. This paper examines the trends and growth of VAT and its impact on profitability of manufacturing industries in Maharashtra. II.RESEARCH METHODOLOGY & DATA BASE OF THE STUDY: There are large number of manufacturing industries in India in general and Maharashtra in particular. This study is based on both primary and secondary data, which have been collected from 100 industries and these industries are grouped into five categories. They are, Infrastructure Industries (10), Capital Goods Industries (18), Pharmaceutical Industries (25), Consumer Goods Industries (24), and Other Industries (23). The detailed discussion was also held with tax consultants, financial officers of various companies. The primary data was obtained through the following methods such as personal interviews, telephonic interviews, questionnaires, etc. The secondary data was collected from publication of Reserve Bank of India, Ministry of Finance (Economic Survey) Government of India and Government of Maharashtra, database of CMIE etc. Present study focuses on the following statistical tools to measure the profitability of organization. Co-efficient of Variation, Compound Growth Rate Analysis, Regression Analysis etc. Research Papers ABSTRACT Maharashtra is one of the 21 states which have introduced the Value Added Tax (VAT) system of taxation from 1st April 2005. With introduction of VAT, we have moved to a globally recognized sales taxation system that has been adopted by more than 150 countries. The design of Maharashtra state VAT is guided by the best international practices with regard to legal frame work as well as operating producers. VAT is collected at each stage in the chain when value is added to goods. Dr. M S Deshmukh. ISSN:-2230-7850 VAT & ITS IMPACT ON PROFITABILITY OF MANUFACTURING INDUSTRIES IN MAHARASHTRA Dr. M S Deshmukh. Assistant Professor S K Somaiya College of Arts Science & Commerce, Mumbai-77. Please cite this Article as : , INDUSTRIES IN MAHARASHTRA : Indian Streams Research Journal (JUNE ; 2012) Dr. M S Deshmukho VAT & ITS IMPACT ON PROFITABILITY OF MANUFACTURING