Tax increased on luxury cars and buildings in Kerala

Continuing its drive to mobilise more resources in view of severe financial crisis, Congress-led UDF government in Kerala today brought luxury cars and buildings under higher tax rate net with a view to garnering an additional revenue of Rs 260 crore.
Cars valued over Rs 20 lakh would now attract a tax at a rate of 20 per cent and buildings above 3,000 sq feet and flats above 2,000 sq feet would attract more tax.
However, in the wake of protest from various quarters, the Cabinet decided to make certain changes in the water tariff hike which it effected last week rolling out a concession to a tune of Rs 32 crore to BPL category and those who use 15,000 litres of water per month.

"The new taxes will not in any way affect the common man," Chief Minister Oommen Chandy told reporters after a cabinet meeting here.
Indicating that more resource mobilisation measures were on the cards, he said many more recommendations were under consideration of the government. As a measure to cut down government expenditure, it was also decided not to sanction advertisements of government functions till March 31 next.
Cabinet approved ordinances to be brought in to effect the new tax rates announced last week to net a total additional revenue of about Rs 2,100 crore.

In a major post-budget exercise of Additional Resources Mobilisation (ARM) last week, government had hiked tax on Indian Made Foreign Liquor by 20 per cent and imposed a cess of 5 per cent and increased tax on cigarettes and tobacco products by 8 per cent from the existing 22 per cent.

The move was seen as a measure to cover revenue loss the government suffered due to its decision to to close down 732 liquor bars as parts of its policy to reduce liquor availabilty in the state with a view to having total prohibition in five years time.
The anticipated revenue loss due to new liquor policy, which also included closing down in phases the Beverages Corporation outlets, was estimated to be Rs 1,800 core to the ex chequer.