Tax rates hiked in TN

9:44 PM in

Tamil Nadu government on Monday revised tax rates on certain products in order to generate additional revenue of Rs 3,900 crore per annum. The revised tax rates would be effective from from Tuesday, Finance Secretary K Shanmugam said in a release. Value Added Tax (VAT) on certain articles was increased to five per cent from the present four per cent, it said.

.

Textile and textile products which were under tax exemption would also come under the five per cent tax. However, in a relief to agriculture sector, fertilizers and insecticides which were taxed at four per cent now would be exempted from the hike. The VAT on commodities charged at 12.5 per cent was hiked to 14.5 per cent as Karnataka and Andhra Pradesh also hiked it to 13.5 per cent and 14.5 per cent respectively, the release said. The Centre had abolished Additional Excise Duty (AED) and permitted states to levy sales tax, the release said, adding hank yarn and handloom fabrics would continue to be tax exempted. In edible oil sector, in order to bring bigger players under tax net, the government had decided to reduce exemption of the turn over limit from Rs 500 crore to Rs five crore. Earlier, those companies which were having revenues less than Rs 500 crore need not to pay sales tax. But with the proposed plan, those companies reporting more than Rs five crore revenue need to pay sales tax. In a move that would increase the cost of tobacco and tobacco products, it was decided to add VAT of 20 per cent to to chewing tobacco, snuff and cheroot, which were earlier under tax exemption. Beedi and beedi tobacco will also be charged at 14.5 per cent, it said. Prices of electronic goods like LCD panels, DVDs, mobile phones, iphones and ipods and the electronic components would also increase as the government increased the present tax of four per cent tax to 14.5 per cent. Registration fees on land agreements relating to title deeds, lease deeds and power of attorney to sell immovable properties also revised upwards due to which it was expected to generate additional revenues of Rs 300 crore per annum, it said.