"The advantages and disadvantages of a change to value-added tax regime have not been examined in depth," the states said opposing the plan at the state chief ministers' and finance ministers' conference here to discuss regulation of non-banking financial companies and centralised-tax system among other issues.

VAT could be regresive and may take a disproportionate share of the income of poorer families, Orissa chief minister JB Patnaik said, adding this could be countered in a VAT designed by exempting or zero-rating basic food stuffs and essential consumer gods.

Gujarat opposed moves for abolition of central sales tax saying it would have "grave implications" on the revenue of states.

"Any move in this direction will certainly lead to tax evasion on alarge scale in respect of inter-state sales as also local sales," state finance minister Vajubhai Vala said at the meeting.

Madhya Pradesh chief minister Digvijay Singh said unless the states were financially strong, no tax reforms could be successfully implemented.