Rajasthan to implement VAT from April 1

Jaipur, Mar 8 (UNI) Rajasthan Chief Minister Vasundhara Raje announced switching over to Value Added Tax (VAT) from next financial year while presenting a Rs 60.85 crores surplus budget for 2006-07 in the state sssembly today.

Ms Raje also announced imposition of some new taxes.

Delivering her third budget in the state assembly , Ms Raje said the state would switch over to VAT from April 1. "As you all know our neighbouring states Chhattisgarh, Madhya Pradesh and Gujarat have already announced implementation of VAT from April 1, so after holding discussions with traders, economists, tax consultants and public representatives it has been decided that for industrial development and to give a fillip to exports and for overall development of the state it would be appropriate for the state to implement VAT", she said.

The revenue deficit estimated at Rs 1523 crore in the budget estimates of 2005-06 is likely to be much lower at Rs 865 crore in the revised estimates.

She said in a bid to solve the problems of traders and industrialists in connection with VAT, the state government would set up a state level committee and district committees to identify these problems. Several goods of local importance like handicraft items, puppets, blue pottery, rakhi, mishri-pastha as prasad, chalk stick and takhti, muddhas, kites, handicrafts have been exempted from VAT, she said.

She proposed exemption from entry tax on motor parts and electrical and electronic goods used as raw material.

In order to give a push to setting up of new auto parts and ancilliary units, she proposed 50 per cent exemption under CST. she however propopsed to raise entry tax on pan masala from 4 to 8 per cent, on pan masala with tobbaco from 16 to 20 per cent and on cigArattes from 6 to 12 per cent.

Ms Raje also has proposed a one per cent entry tax on wind mills and its equipment, two per cent entry tax on optical fibre cable,4 per cent on ceramic and glazed tiles, 4 per cent on glass and glass sheets and 4 per cent on all type of sanitary items and fittings and pipe and pipe fittings. However the entry tax would not be payable if local tax is already paid, she added.

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