Karnataka State Budget 2012

Commercial Taxes

Value Added Tax

• Reliefs
  • Tax exemption on paddy, rice, wheat, pulses and products of rice and wheat continued for one more year from April, 2012.
  • Tax reduction on ready to cook chapathi and parota reduced from 14 per cent to 5 per cent.
  • Tax reduction on un-ginned raw cotton from 5 per cent to 2 per cent.
  • Tax reduction on dry chillies from 5 per cent to 2 per cent and revision of Central Sales Tax on inter-State sales from 1 per cent to 2 per cent.
  • Tax reduction on surgical footwear from 14 per cent to 5 per cent
  • Tax exemption on Braille watches.
  • Tax reduction on black boards from 14 per cent to 5 per cent.
  • Tax reduction on jewellery and articles of gold and other noble metals, precious and semi-precious stones from 2 per cent to 1 per cent.
  • Tax reduction on works contract of manufacture of readymade garments and embroidery work from 14 per cent to 5 per cent
  • Tax reduction on furnace oil sold to foreign going vessels from 14 per cent to 1 per cent
  • Tax reduction on naphtha from 14 per cent to 5 per cent.
• Additional Resources Mobilization Measures
  • Levy of VAT at 5 per cent on beedies.
  • Levy of VAT on cigarettes and other tobacco products from 15 per cent to 17 per cent.
  • Levy of VAT at 5 per cent on plastic woven fabrics.
• Central Sales Tax Rationalization Measures
  • Revision of Central Sales Tax on inter-State sales of dry chillies from 1 per cent to 2 per cent.
• Agricultural Income Tax Relief
  • Tax exemption to partnership firms
• Betting Tax: Additional Resource Mobilization Measure
  • Increase in the minimum daily lumpsum tax payable by private bookmakers operating in Bangalore and Mysore.
• Rationalization and Simplification Measures
  • Penalties for the offence of non-maintenance of proper books of account to be increased from two thousand rupees to five thousand rupees and from five thousand to ten thousand rupees under Value Added Tax.
  • Penalty for the offence of non-production of records and non-furnishing of information to be increased from five thousand rupees to ten thousand rupees under Value Added Tax
  • Restriction to be imposed on filing of revised returns under Value Added Tax.
  • Provision to be made for prosecution of dealers who fail to file return continuously for a period of three months or two quarters under Value Added Tax.
  • Provision relating to deduction of tax at source in the case of certain goods under Value Added Tax to be deleted.
  • Provision of deemed rectification under Value Added Tax to be deleted.
  • Provision relating to debit and credit notes under Value Added Tax to be deleted.
  • Provision to be made to specify five years as the period of limitation for assessment or reassessment under Value Added Tax.
  • The powers of the appellate authority to stay disputed penalty and other amounts to be clarified under Value Added Tax.
  • Claim of double deduction in respect of consumables used in works contract under Value Added Tax to be prevented.
  • Government and Commissioner to be empowered to notify the goods for issue of transit pass and provision to be made for electronic application and also for electronic issue of transit pass under Value Added Tax.
  • Audited statement of account to be amended to delete the advice relating to filing of revised return under Value Added Tax
  • Provision of automatic cancellation of stay orders after 240 days under Value Added Tax.
  • Commissioner to be empowered to notify the website in which particulars of specified goods brought from outside the state should be entered.
  • Self assessment to be made under Entertainments Tax and Luxury Tax.
  • Automatic registration of proprietors of cinema theatres to be made under Entertainments Tax.
  • Scheme of quarterly filing of returns under Profession Tax to be withdrawn.
  • .Time limit for filing revision petition to be increased to 180 days under Professions Tax, Entry Tax and Agricultural Income Tax.
• Stamps and Registration
  • Stamp duty of Rs. 100/- being levied on Customs bond to be extended to Excise bond.
  • "Currencies" to be included under the "Brokers' Note" along with Goods or Commodities.
  • In respect of agreements relating to Works Contract the stamp duty to be levied at 0.01% subject to a maximum of rupees five lakhs.
  • In respect of partnership deeds, the minimum slab of capital and the stamp duty payable thereon to be increased.