Highlights of Karnataka Budget Speech - 2014-2015

18^th February, 2014

Highlights of Karnataka Budget Speech - 2014-2015 presented on 14^th February 2014 and amendments proposed in various Commercial Tax & Other Laws:

Karnataka VAT Act, 2003:

Ø  Change in Tax Rates:

·         Levy tax at 5.5% on liquor sold by bar and restaurants operating in urban areas and by clubs, lodging houses and star hotels, as last point tax to capture tax on value addition.

·         Tax on scented areca nut powder other than mixtures, to be reduced from 14.5% to 5.5%.

·         Exemption on paddy, rice, wheat, pulses and products of rice and wheat to be continued for one more year from April 2014.

Ø  Other Proposals:

·         Increase in the registration limit from Rs. 5 Lakhs to Rs. 7.5 Lakhs of annual turnover.

·         Exempt works contractors from compulsory registration

·          Increase in the minimum sale value for obtaining e-SUGAM from Rs.20,000 to Rs.25,000.

·         Filing of annual statements by dealers in order to avoid disputes in the information provided in electronic returns

·         To take suitable administrative measures in order to enable dealers to rectify mistakes in the returns which have no tax implications

·         Waiver of penalty in case of small dealers who have no tax liability who opt for cancellation of their registration.

·         Single appeal to be filed for several tax periods of one financial year in case of appeal to the Karnataka Appellate Tribunal against re-assessment.

Karnataka Tax on Luxuries Act:

·         Increase in the minimum daily rent for levy of luxury tax on accommodation provided in a hotel from Rs. 500/- to Rs. 750. 

Karnataka Tax on Entry of Goods Act:

·         Filing of monthly returns by dealers and deemed acceptance of such returns as under VAT Act

·         Exemption from entry tax on ethanol brought for mixing with petrol

Karnataka Stamp Act:

·         Stamp duty exemption for alternate sites allocated by BDA consequent to de-notification of the land.

·         Reduction in Stamp Duty on Award relating to movable properties from 5% to rates ranging from 0.25% to 0.75% on slab basis.

·         Stamp Duty to be levied at uniform reduced rate of 2% on all Joint development agreements and their consequent Powers of Attorney. 

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Note :- Full credit goes to my Friend shri Gurudatta Shenoy , ADVOCATE & TAX CONSULTANT who has provided it