Punjab reduces VAT on cigarettes, iron & steel; launches insurance scheme for traders
Updated: Jan 21, 2014 01:38:35pm
Chandigarh, Jan 21 (KNN) In a major boost to the industries in the state, the Punjab cabinet has given its nod to roll back the value added tax (VAT) on cigarettes, iron and steel products and has also decided to introduce a "social security scheme for business community" to give insurance cover to businessmen in the state.
The Punjab Cabinet yesterday gave its nod to launch an insurance scheme called Social Security Scheme for 1.86 lakh traders, providing accidental death and disability cover.
Under the scheme, insurance cover will be given to as many as 1,86,543 dealers / businessmen, who have a turnover up to Rs 1 crore.
However, the businessmen, who are covered under any other social security scheme of Punjab, would not be eligible for the scheme.
Under this scheme, insurance covers would be extended to the beneficiaries, including Life Insurance (Accidental Death and Disability Insurance) with cover of Rs 2 lakh per beneficiary, including accidental death and permanent or partial disability, health insurance cover to meet meeting expenses of hospitalisation of up to Rs 50,000 per beneficiary.
Both private and public hospitals would be empanelled to provide smart card based cashless hospitalisation to the beneficiaries, an official release said.
The state government would bear an expenditure of Rs 25 crore annually on account of insurance premium.
Giving relief to the secondary steel and iron industry, the Cabinet decided to slash the rate of VAT from 4.50 per cent (plus 10 per cent surcharge) to 2 per cent (plus 10 per cent surcharge. It also reduced advance tax on finished goods to 2.50 per cent.
It was estimated that implementation of the new scheme would result in loss of Rs 200 crore approximately but it would also lead to the revival of iron and steel industry, which had been passing through rough weather for the past several years.
The Input Tax Credit (ITC) would be restricted to only two stages, which would curb bogus billing and false refunds prevalent in the industry besides differentiating between the good tax payers and fraudsters.
Further, the Punjab cabinet also rolled back VAT on cigarettes from 50 per cent to 20.5 per cent (plus 10 per cent surcharge) to check its smuggling.
In order to curb the sales of cigarettes, the Punjab Government last year had hiked the VAT on cigarettes.
However, the decision to reduce VAT was taken at a meeting of the Cabinet chaired by Punjab Chief Minister Parkash Singh Badal here yesterday.
In a major relief to the general public, the Cabinet has also given its nod to a proposal put forth by the Local Government department to give 10 per cent rebate on Property Tax deposited up to March 31, 2014, instead of the earlier date of December 31, 2013.
Similarly, the Cabinet has also given its nod for reducing the rate of property tax to be levied on residential properties under rent from existing 7.5 per cent to three per cent.
The rate of penalty has also been reduced from 25 per cent to 10 per cent in case of tax deposited after the due date of December 31 but before the end of financial year. (KNN Bureau/SD)
The Punjab Cabinet yesterday gave its nod to launch an insurance scheme called Social Security Scheme for 1.86 lakh traders, providing accidental death and disability cover.
Under the scheme, insurance cover will be given to as many as 1,86,543 dealers / businessmen, who have a turnover up to Rs 1 crore.
However, the businessmen, who are covered under any other social security scheme of Punjab, would not be eligible for the scheme.
Under this scheme, insurance covers would be extended to the beneficiaries, including Life Insurance (Accidental Death and Disability Insurance) with cover of Rs 2 lakh per beneficiary, including accidental death and permanent or partial disability, health insurance cover to meet meeting expenses of hospitalisation of up to Rs 50,000 per beneficiary.
Both private and public hospitals would be empanelled to provide smart card based cashless hospitalisation to the beneficiaries, an official release said.
The state government would bear an expenditure of Rs 25 crore annually on account of insurance premium.
Giving relief to the secondary steel and iron industry, the Cabinet decided to slash the rate of VAT from 4.50 per cent (plus 10 per cent surcharge) to 2 per cent (plus 10 per cent surcharge. It also reduced advance tax on finished goods to 2.50 per cent.
It was estimated that implementation of the new scheme would result in loss of Rs 200 crore approximately but it would also lead to the revival of iron and steel industry, which had been passing through rough weather for the past several years.
The Input Tax Credit (ITC) would be restricted to only two stages, which would curb bogus billing and false refunds prevalent in the industry besides differentiating between the good tax payers and fraudsters.
Further, the Punjab cabinet also rolled back VAT on cigarettes from 50 per cent to 20.5 per cent (plus 10 per cent surcharge) to check its smuggling.
In order to curb the sales of cigarettes, the Punjab Government last year had hiked the VAT on cigarettes.
However, the decision to reduce VAT was taken at a meeting of the Cabinet chaired by Punjab Chief Minister Parkash Singh Badal here yesterday.
In a major relief to the general public, the Cabinet has also given its nod to a proposal put forth by the Local Government department to give 10 per cent rebate on Property Tax deposited up to March 31, 2014, instead of the earlier date of December 31, 2013.
Similarly, the Cabinet has also given its nod for reducing the rate of property tax to be levied on residential properties under rent from existing 7.5 per cent to three per cent.
The rate of penalty has also been reduced from 25 per cent to 10 per cent in case of tax deposited after the due date of December 31 but before the end of financial year. (KNN Bureau/SD)
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