13 Sep 11: The state government has increased the primary VAT (Value Added Tax) slab on essential commodities by 1%. Due to this hike all the goods coming under Schedule IV will have to pay 5% tax as against the previous tax rate of 4%. Under this group there are over 124 categories of goods. Some of the commodities under these categories which are widely used by common man are pulses, edible oils, broomsticks, medicines, stationary, food grains, ground nut, chilli, flour, etc. Apart from these other goods such as LCD and LED panels, UPS, microphones, ready-made garments, switches, agarbathis, stationary computers and safety panels are also included.
The government has also increased VAT on Tobacco products and gutkha products from the present 14.5% to 20%. These tax hikes have come in to immediate effect and the businessmen are required to file their sales return with the new rate of to the sales affected in September on or before October 20.
This increase in VAT will also affect the prices of brick, beedi leaves, bitumen, cycles, bulk drugs, fertilizers and pesticides, cotton and yarn.
Source: The hindu business line