The Hindu : New Delhi News : VAT on household items reduced

Online edition of India's National Newspaper
Wednesday, Jul 13, 2005

New Delhi

New Delhi

VAT on household items reduced

Staff Reporter

Bid to maintain parity with other States `The rationalisation would go a long way in providing relief to the common man and make the new regime consumer-friendly'

NEW DELHI: In another round of reductions under the new Value Added Tax (VAT) regime, the Delhi Cabinet on Tuesday reduced VAT from 12.5 per cent to 4 per cent on a large number of household items and also exempted certain other items including agricultural implements from the purview of tax.

According to Finance Minister A.K. Walia, who briefed news persons after the Cabinet meeting held under the leadership of the Chief Minister, Sheila Dikshit, the rationalisation would go a long way in providing relief to the common man and make the new regime consumer-friendly.

Dr. Walia said items of daily use and household items have been brought down to the 4 per cent slab instead of 12.5 per cent so far.

These include welding equipment, glues, adhesives, sealed and packed flavoured milk and yoghurt, additives, salt, slippers, intermediates and other chemicals used in various types of electroplating, lay flat tubing which is used for manufacture of plastics bags by small traders and processors, unbranded goli and toffee, coated abrasives, kites and all other varieties of textile fabrics not covered in any other schedule.

The household items include plastics commodities such as combs, jugs, soap case, mug, toothbrushes, looking glasses, photo frames, chakla-belan, cutlery, tea, lunch boxes, bottles, trays, basket, mats, tubs and drums up to 100 litres capacity, a large number of fittings for door and windows, all other scraps not included in any other schedule, spares and accessories of mechanised agricultural implements.

Dr. Walia announced that the Cabinet had approved a mechanism to determine taxable turnover of sales of residential hotels charging composite sum for lodging and boarding.

The percentage for determining the turnover varies from 5 per cent to 30 per cent depending upon the services provided.

Granting another relief to trade organisations and individuals, the Cabinet also decided to reduce the submission amount of Rs.10,000 to Rs.5,000 per question for determination of a specific clarification of their doubts regarding interpretation of certain items in the VAT schedule.

The charges and rates of taxation have been reduced to maintain parity with other States, it was stated.

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