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According
to the Government notification, the commodities have been
divided into four categories some of which have been freed
from VAT while others like gold and silver will attract
one per cent tax. Over 150 commodities have been exempted
from VAT. Most of the taxable items have been kept within
the four per cent tax limit.
The
items which have been kept out of the tax net include
equipment used in farming, Banarasi saris, butter milk,
bread, khadi, firewood, chikan products and blood and
blood plasma.
One
per cent tax will be levied on gold, silver, gems and
bullion.
However,
it is the commodities largely used by the common man which
will become costlier from January 1 as 4 per cent tax has
been proposed for several items of daily use. These
include rice, wheat, paddy, pulses, jaggery, honey,
matchboxes, tea, oilseeds, sweets, khandsari, hosiery
goods and knitting wool. Four per cent tax will also be
levied on audio, video cassettes, IT products, electronic
products, TV , radio, cell phone and its parts, DVDs, CDs
and industrial products like zinc, tin, uranium, liquid
glucose and nepthalene.
While
sugar, wheat flour, maida, textiles and scientific
equipments will become costlier, milk products like
“khoya”and “paneer”, milk powder, spices, edible
oils, kerosene oil, sewing machines, chemical fertilisers,
water pumps and tractors will become cheaper after the new
tax regime is enforced.
A
significant feature of the new measure is that tax evasion
by traders, wholesalers and retailers would become
virtually impossible as the trade tax authorities have
been empowered to seal the commercial establishments and
even conduct raids on the residential premises of the tax
evaders.
In
a bid to infuse corporate culture, the Trade Tax
Department has been renamed Commercial Tax Department and
the trade tax officers will be known as commercial tax
officers. Registration has been made mandatory. Running a
business without registration would entail a fine of
Rs.100 per day.
Source
:
The Hindu,
India, dated 22/12/2007
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