Orissa Revises St On Non-Essential Items

The Orissa government has effected wide-scale changes in the tax rates of several non-essential items in a bid to rationalise the sales tax structure in the state. The revised tax structure, which has received the state cabinet's approval, is expected to net an additional revenue of Rs 20 crore in the current year.

While sales tax on foreign liquor, cellular phones, high speed and light diesel oil, electronic goods and food served in big hotels and restaurants has been increased, the same for gold and silver ornaments, cars, jeeps,

trekkers and bitumen has been downwardly revised.

The sales tax on ornaments has been reduced from 12 per cent to 10 per cent while that on cars, jeeps and trekkers has been scaled down from six per cent to four per cent. The same for taxifare reading meters has come down from 12 to four per cent and bitumen from 12 to eight per cent.

 

On the other hand, sales tax on foreign liquor has been doubled to 20 per cent.

While the tax rates for high speed and light diesel has been raised by two per cent to 18 per cent, that for electronic goods like tape recorders, two-in-ones, watches, telex machines, washing machines, calculators, microscopes, intercoms, VCRs, and VCPs has been increased from two per cent to four per cent. For food served in big hotels and restaurants the tax has been raised from four per cent to eight per cent.

In another development, the government, for the first time has brought sugarcane and fire wood (used for a different purpose) under the tax net by imposing sales tax at the rate of two per cent and four per cent respectively.

The government has exempted certain medical equipment and drugs from the purview of sales tax. These include artificial limbs, wheel chairs, crutches, celliperses, traction hand splints, surgical shoes, oral contraceptives and neotral oral dehydration salts.

The sales tax collection, as per the budget estimates, in targeted at Rs 1060 crore in 1997-98.

Rationalisation of tax structure was a long standing demand of the industries and trade associations in the state.

The traders complain that a high rate of taxation in certain consumer items in the state vis-a-vis its neighbours like Andhra Pradesh and West Bengal results in business going out of the state everyday.