Tax Proposals – Commercial Taxes
1. Value Added Tax – relief’s
o VAT exemption on paddy, rice, wheat, pulses and products of rice and wheat extended for one more year from 1.4.2010.
o Tax on Masala Powder Mixtures, Macaroni, Sports Trophies, Shields and Medals, all kinds of scrap, Electric generators of less than 15 KVA, railway concrete sleepers, school bags costing up to Rs 200, reduced from 12.5 % to 5 %.
o The minimum annual turnover limit for registration increased from Rs. 2 lakhs to Rs. 5 lakhs.
o The maximum annual turnover limit for opting for Composition Tax Payment Scheme increased from Rs.15 lakhs to Rs.25 lakhs.
o Annual turnover limit for compulsory audit of accounts of dealers increased from Rs.40 lakhs to Rs.60 lakhs.
o Optional scheme for dealers in medicines to pay tax based on the MRP even on sale of other goods.
o Advance Ruling Mechanism for dealers to seek clarifications and advance rulings to be introduced.
Additional resource mobilisation measures
o VAT rate 4% increased to 5% on all goods except declared goods.
o VAT rate of 12.5% increased to 13.5%.
o VAT rate of 12.5% on tobacco products increased to 15%.
o Levy of VAT on tobacco products on MRP basis.
o Luxury tax on hotels with daily room rents from Rs.1,000 to Rs.2000 increased from 6% to 8%.
o Luxury tax on hotels with daily room rents exceeding Rs.2,000 increased from 10% to 12%.
o Provision for collection of Entry Tax on sugar at the point of sale by sugar factories.
Facility to tax payers
o Facility for electronic submission of returns and other documents and also payment of tax.
o Relief extended in payment of interest if sales tax arrears are paid before June 30th 2010.
Stamps and Registration
Revision in stamp duty rate
o Stamp duty on sale agreement reduced from 0.25% to 0.1% limited to a maximum of Rs.20,000/-.
o Stamp duty on joint development agreements and GPA at 1% of market value limited to a maximum of Rs.1.5 lakhs.
o Stamp duty on agreements relating to shares, debentures and other marketable securities reduced from Rs.200 to Rs.50 and on note or memos given to brokers, depositors and fixed at
0.01% limited to a maximum of Rs.50. o Stamp duty on DTD reduced from 0.25% to 0.1% limited to a maximum of Rs.50,000.
o Amendment to Act to plug evasion of stamp duty in transfer of apartment/flat.
o Provision for adjustment of duty when property is sold to GPA holders.
O Rationalisation of fee for cancellation of deeds
O Stamp duty on Amalgamation and demerger of companies reduced from 5% to 3%.
o Levy of stamp duty at 1% on TDR agreements.
o Further rationalisation in stamp duty on lease and licence of properties for duration of less than 1 year stamp duty of 0.5% and a maximum of Rs.500 for residential buildings levied. From 1 year to 10 years 1% on average annual rent and advance, from 10 years to 20 years 2%, above 20 years up to 30 years 3%.
o Exemption in stamp duty and registration fee on clearance certificates relating to loans availed by farmers, rain water harvesting units, student education, non-conventional energy source units like solar, biogas and houses built under Indira Avas Yojane
o Total stamp duty and registration fee exemption on documents relating to transfer for public purposes to local bodies and urban development authorities.
Motor Vehicles Tax
o Estimated collection of revenue for the year 2010-11 is Rs.2200 Crore
o Increase in quarterly tax on two wheelers purchased by Central Government employees from Rs. 25 to Rs. 125 and on other vehicles from Rs.187.50 to Rs. 500.
o Lifetime tax scheme extended to light goods vehicles upto 5,500 kgs. This scheme applicable to even goods vehicles already in use.
o Increase in quarterly tax on stage carriages from Rs.500 to Rs.600 per seat
o Increase in quarterly tax on stage carriers with special permits from Rs. 700 to Rs. 1000 per seat
o Increase in life time tax on two wheelers.
o Increase in life time tax on cars and jeeps.
o Increase in quarterly tax on omni buses with national permits from Rs.2,500 per seat to Rs.2,750.
o Life time tax of 10% levied on all construction equipment vehicles such as cranes, mobile cranes, forklift, etc.