M A I N   N E W S

Punjab VAT sops of Rs 350 cr
Tribune News Service

Chandigarh, May 3
While the Punjab Council of Ministers today further diluted the provisions relating to value added tax, it also announced concessions worth Rs 350 crore for farmers, traders, manufacturers, exporters and customers by removing certain items from the tax slabs of 12.5 and 4 per cent to zero per cent. Various items were shifted to the 4 per cent slab from the 12.5 per cent slab. Certain items in the 12.5 per cent slab were placed in the zero per cent slab.

To please the farming community, the council shifted fertilisers, pesticides, all seeds and cattle feed, to the tax-free category. Likewise, atta, all sorts of salts, gur, jaggery, mechanised agricultural implements, green tea, khadi garments, bangles, hawan samagri, mishri, patasha, fullian, makhana and papad, etc, were put under the tax-free category.

A spokesman of the government said these concessions included Rs 150 crore on Canteen Stores Department (CSD) items; Rs 20 crore on pesticides and fertilisers; Rs 21 crore on tea; Rs 3 crore on green tea; Rs 1 crore on atta, maida and suji; Rs 8 crore on nuts and bolts; Rs 10 crore on handtools; Rs 5 crore on dry fruit; and Rs 32 crore on miscellaneous items.

He said the council has exempted all sales made through the CSD under VAT with effect from April 1, 2005. Besides, it also decided to take some trade friendly measures such as the rate of interest to be paid by the state and the dealer in the case of delayed payments which was made a uniform 1 per cent per month. Prior payments for entertaining an appeal in the case of dispute had been restricted to 25 per cent only. Intra-state sales to government departments and the PSEB was allowed against the D form and intra-state purchases in the course of export out of India against the H form.

Provision for the verification of cash and valuables was done away with. The limit for the registration of dealers was increased from Rs 30 lakh to Rs 50 lakh. Option was given to file monthly returns to exporters and inter-state traders to facilitate early refund which would be allowed within 60 days instead of 90 days.

A turnover tax would have to be paid up to a turnover of Rs 50 lakh and it would not be covered under VAT.

All these decisions except those relating to the CSD would not be applicable with effect from May 5, 2005.

A subcommittee comprising the Finance Minister, the Excise and Taxation Minister and the Food and Supplies Minister was set up to look into all representations from trade and industry and those pertaining to items which had been left out as well as difficulties faced in the implementation of VAT. The subcommittee would present specific proposals to the council of ministers for consideration.

List of tax concessions

Tax reduced from 12.5 per cent to 0 per cent

The items include all bangles except those made of precious metals; maps, charts, globes; feed supplements (aquatic, poultry and cattle feed); firewood except casurina and eucalyptus timber; fish seed; goods taken under customs bond for re-export; husk of pulses; mishri, patasha, fullian, makhana, chirbara; pappad; tasla; terry towels and hawan samagri.

Tax reduced from 4 per cent to 0 per cent

The items include all kinds of salt; all seeds other than oil seeds; gur and jaggery; non-branded atta, maida, suji and besan; Khadi garments/goods; wheat bran; power driven agricultural implements; crudely tanned leather and desi jutis made thereof; and green tea.

Tax reduced from 12.5 per cent to 4 per cent

The items include all processed fruits, vegetables, etc, including fruit jams, jellies, pickles, fruit squashes, fruit juices, fruit drinks; all utensils, including pressure cookers/pans except utensils of precious metals; bedsheets, pillow covers; bicycles/tricycles and tyres and tubes thereof; buckets made of iron and steel, aluminium, plastic or other material; candles; china clay and ball clay; coal tar; combs; computer stationery; cottage cheese; cups and glasses of paper and plastics; drugs and medicines, including vaccines, syringes, dressings and ointments, medical equipment, devices and implants; feeding bottles and nipples; and fly ash.