Setting his eyes on the 2012 Assembly elections in Uttarakhand, Chief Minister Ramesh Pokhriyal Nishank today tried hard to capture the imagination of the electorate through a series of tax incentives.
Buoyed by increase in revenue receipts, which are now estimated at Rs 12,158.79 crore compared with Rs 10,952.19 crore last year, Nishank has passed on the benefit to the people by reducing VAT on a number of items like kerosene and khadi and handloom products as part of his “mission 2012”.
Nishank has also attempted to strike a balance between the ballooning non-plan expenditure and development schemes.
With the Centre hiking prices of petrol and diesel, the CM provided relief to the economically poor sections by reducing VAT on kerosene from 12.5 per cent to 4 per cent.
VAT on products made by khadi gramudhyog industries like matches, crackers, candles, gum, fibre, hand-made paper, paperboard, file cover, file board, invitation cards and drawing papers has been abolished. This attempt is being seen as a move to boost the cottage industries in the hill state, which the government believes has the potential to bring down the unemployment rate. To encourage the handloom industry, VAT on handmade woollen carpets has been abolished.
Nishank has also safeguarded the interest of farmers by abolishing VAT on thrashers. Stamp duty exemptions on agriculture loans to farmers have been extended till March 31, 2011. In addition to this, the loan limit for exemption will be increased from Rs 3 lakh to Rs 5 lakh.
In the interest of students, VAT on writing ink will be abolished. VAT has been reduced from 12.5 per cent to 4 per cent on cotton waste and textile-waste, which are commonly used in pillows and mattresses.
Stamp Duty on purchase and sale of immovable property will be reduced to 6 per cent from 7 per cent.
Entertainment tax on cable TV will be reduced to Rs 20 per month for residential connections and Rs 40 per month for commercial ones. In view of the economic difficulties faced by the old cinema halls, permission for construction of new cinema halls in their places will be given. This was the longstanding demand of the cinema houses in the hill state.
Significantly, the budget is silent on the recent surcharge. The state government had already decided to impose .5 to 1 per cent surcharge on scores of FMCG and day-to-day basis food items from April 1.
