Highlights
of Karnataka Budget Speech - 2013-2014 and amendments proposed in various
Commercial Tax & Other Laws:
Karnataka
VAT Act, 2003:
Ø
Change
in Tax Rates:
- The general rate of VAT which was increased from 5 % and 14 % to 5.5 % and 14.5 % respectively, earlier, shall continue to be applicable up to 31.07.2013 and shall be reduced to the original rates with effect from August 2013
- VAT exemption on paddy, rice, wheat, pulses and products of rice and wheat extended for one more year from 01.04.2013
- Taxation scheme on soya bean edible oil manufacturing unit suitably modified – details awaited
- VAT rate reduced on the following goods to 5.5% (applicable form 01.04.2013):
-
arecanut de-husking machine
-
cocoa husk
-
Refractory monolithic powder
-
Domestic containers
-
Footwear costing up to Rs. 200
-
Doors and window frames and doors and window shutters
made from waste plastic
-
Air compressors and their parts including engines –
included in list of capital goods
-
On purchase of supplementary nutrition food made under
integrated child development scheme for supply to children, pregnant women /
nursing mothers and adolescents by anganawadi workers run by Women and Child Welfare Development
Ø
Payment
of disputed VAT & other amounts:
·
The present requirement to remit 50 % of the
disputed taxes and other amounts for obtaining stay form recovery of amounts
disputed in appeals reduced to 30 %. Welcome amendment to dealers as the amounts of
pre-deposit to obtain stay of recovery proceedings reduced, however, the dealers
may be required to furnish sufficient security for balance 70 % of the disputed
taxes and other amounts and generally Bank Guarantees are insisted as security.
·
The current time of ten days given for payment
of additional demand created on completion of assessment / re-assessments
increased to thirty days from
date of service of demand notice. This amendment brings in line, the time
allowed to make payment of additional demand created, with the time allowed for
filing first appeal under the KVAT Act and thus no recovery proceedings can be
initiated within 30 days of service of the Demand Notice. This shall be applicable for the Demand
notices to be issued on or after 01.04.2013 and up to March 2013 the present
provisions shall continue to apply.
Entry Tax:
·
Registration
threshold limit increased from rupees two lakhs to rupees five lakhs
Professions Tax:
·
Provision made for filing appeal against best
judgment assessment order
Stamps & Registration:
·
A cap of Rs. 1.5 lakhs put on registration fee
of 1 % payable on Joint Development Agreement and related Power of Attorney
Motor Vehicles Act:
·
Lifetime tax to be collected on construction
equipments in one installment instead of two installments
·
Electronic payment facility for payment of taxes
and fees in respect of motor vehicles
Please note, the above is list of
the amendments proposed in Commercial Tax Laws in the Karnataka Budget Speech
for the year 2013-2014. The changes
proposed shall be applicable only after passing of the Acts.