UP tax proves onerous

With the state development tax coming into force from May 1, the prices of all essential commodities including petroleum products have escalated in Uttar Pradesh.

The state development tax at the rate of one percent of the total turnover has been imposed on wholesale traders with annual turnover of Rs 50 lakh and above. The tax would remain in force for five years unless extended by the state government.

According to government estimates the new tax would contribute an additional revenue of Rs 400 crore to the state exchequer in a year.

Petrol prices have increased by 32 paise per litre, diesel prices by 24 paise per litre and LPG prices by Rs 3 per cylinder.

Similar hike in the prices of cellular phone handsets, new auto vehicles, paper products, stationary, jwellery products tyres, electronic goods, has also been recorded.

The hikes in the prices of new cars range between Rs 2,500 and Rs 7,000, while the prices of two-wheelers has increased by Rs 700.

"The hike in the price of automobiles was inevitable after the government's imposition of the state development tax," a local car dealer said.