Govt modifies taxation under VAT in Pondy

Puducherry, July 2: The Puducherry administration has modified the taxation system under the Value Added Tax (VAT), which came into force here yesterday.

In an official release, Puducherry Chief Minister N Rangasamy said the VAT on diesel and petrol had been reduced to 12.5 per cent from the 20 per cent as envisaged under the Ordinance promulgated by the Lt Governor on June two.

He said to prevent inflation and ensure a people-friendly taxation, the Cabinet had taken a decision to exclude 30 essential commodities from the purview of VAT.

The items include footwear costing Rs 200 or less, kerosene sold through PDS and aluminium vessels.

He said LPG cylinders would be subjected to one per cent tax and a two per cent tax would be levied on eatables in hotels against the 12.5 per cent announced.

A four per cent tax would be levied on two wheelers against the 12.5 per cent announced.

The administration, which had decided to levy 15 per cent VAT on arrack and 12.5 per cent on cigarettes, had reduced the tax on chemical fertilizers, pesticides and plastic pipes from four to one per cent.

The government would levy two per cent tax on IMFL against the 12 per cent announced as it would impose additional excise duty on liquor as announced in the budget.

The Chief Minister said the administration would exempt windmills from the VAT as the government was keen to establish more non-polluting industries here.

UNI