CHENNAI: In consonance with the policy of not taxing goods used regularly by housewives, common people and farmers, the Tamil Nadu Government has decided to remove Value Added Tax (VAT) levied on certain goods, Finance Minister K. Anbazhagan announced in the Assembly while presenting the Budget for 2007-08.

The VAT levied on the following goods has been removed:

Kerosene pressure stove, fertilizer mixture manufactured out of chemical fertilizer for which tax has been paid locally, all seeds used for sowing purpose, packed drinking water sold in sealed refill cans and sachets, local sale and inter-State sale of coconut other than copra, peas flour, fried peas, coconut shell powder, panchamirtham, namakatti, vibhuthi and prasadam sold by any dealer, 38 specified traditional medicines, seashell, sea weed, agar agar and alginate, synthetic gems, Thanjavur plates, cloth bag, instruments for drawing and dissection, graph and exercise notebooks, mathematical learning instruments, wood covered lead pencils, writing pencils, erasers, ebonite pens, ebonite ball pens, writing ink including ink tablets, pillow covers, bed sheets and towels made from handlooms and powerlooms cloth other than those made of mill made cloth, camphor in all forms, cashew shell.

Tax exemption granted to all edible oils in the last budget would be extended to all refined oils, the turnover limit for exemption for edible oils including refined oil, oil cake and deoiled cake fixed as Rs. 300 crore in 2000 had been increased as Rs. 500 crore.

Tax exemption granted to pulses and grams in the last Budget would be extended to mochai, karamani, thatta payaru, kollu and avarai. The turnover limit of Rs. 300 crore for the exemption for pulses and grams fixed during 2000 would be increased to Rs. 500 crore per item, the rate of tax on wheat would be reduced from 4 to 2 per cent and rate of tax on bottled mineral water purchased after paying tax and sold by non-star hotels and sweet stalls would be reduced from 12.5 per cent to 2 per cent

Another list

Similarly, the rate of tax on the following commodities used by common people and now liable to tax at 12.5 per cent, would be reduced to 4 per cent. They are:

Chicory and unbranded coffee powder other than instant coffee, masala powder with brand name, tapioca chips, flour, tapioca waste, bajji flour, energy (sathu mavu) flour, unbranded ghee, date syrup, interesterified vegetable oil (vanaspati), unbranded bakery products including bun, rusk, biscuits and cakes; diagnostic kits, diagnostic reagents, accessories, blood bags and disposables, wet grinders, R.C.C. pipes (without input tax credit on purchase of cement), jolleys, door and window frames made of R.C.C. (without input tax credit on purchase of cement), unbranded steel furniture, all plastic goods other than doors, windows, frames, profiles, automobile, industrial and sanitary items, kuthuvilakku, agalvilakku, pavai vilakku, yanai vilakku, kathikai vilakku, kovilmani, karpoora thattu, dhoopkal, moulded idols, audio cassettes including pre-recorded cassettes, accounts books and diaries, school bags and unbranded travel bags, shields, barbed wire, wire rod and wire links, mop made of cotton yarn, used cars/motor vehicles on value addition without input tax credit, textile machinery and parts, fasteners including nails, bushes, washers and rivets, and electroflux.

The Government has also decided to levy 4 per cent tax on certain goods consumed or used by industries in manufacturing:

Superior kerosene oil (without input tax credit), molasses purchased and used in manufacture of chemicals by chemical industries which were earlier permitted to procure molasses at 20 per cent tax. They were not eligible for input tax credit.

Certain goods such as industrial gases, textile machinery etc were ultimately used or consumed as industrial inputs. It had been decided to list such goods to be taxable at 4 per cent when sold either by the manufacturer or by trader as industrial input.

All the tax proposals announced came into effect from January 1, 2007.

The Government had decided to introduce a new scheme, which would enable it to receive the blocked amount without any further delay and at the same time, would enable the parties also to avail themselves of stamp duty concession and get back the registered documents after payment of concessional stamp duty.

There were around 15,000 document writers and 15,000 assistants engaged in document writing associated with the various registration offices in the State. With a view to promoting their welfare, a separate "Document Writers Welfare Fund" will be created.

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