The Delhi government has notified new VAT rates which will make hybrid cars, battery-operated vehicles and e-rickshaws cheaper.
The government reduced VAT on all types of footwear, readymade garments and edible items from 12.5% to 5%.
The new rates will be effective from May 10.
“The government of Delhi is committed to reduce air pollution, promote health of the people and support eco-friendly modes of transport. To achieve these objectives, the government has reduced VAT on hybrid cars, battery operated vehicle and e-rickshaws from 12.5% to 5%. This will help those people who earn their livelihood by plying e-rickshaws,” said a government spokesperson.
The government hopes that reduction in VAT on hybrid vehicles will ensure that a large number of consumers shift from petrol/diesel vehicles to the hybrid ones, reducing vehicular emission. People who buy hybrid vehicles will get heavy tax rebates.
VAT on a number of other commodities — including marble, sweets, savoury snacks, school bags, footwear and readymade garments — has been reduced.
“The common man will be happy with the reduction of VAT on footwear from 12.5% to 5%. Footwear priced at less than `500 is totally exempted from VAT. Similarly, residents will also be relieved with a substantial reduction in VAT — from 12.5% to 5% — on all kinds of readymade garments. The consumers should expect decline in prices of these commodities immediately,” the spokesperson added.
It is expected that reduced rate of VAT will lead to better tax compliance.
“The government appeals to the people of Delhi to help in preventing tax evasion and bringing evaders to book. People should insist on getting a bill having TIN number after every purchase and upload the bills through DVAT Bill App. Participation of people will ensure that the VAT they pay to shopkeepers actually reaches the government for development of the city,” the spokesperson added.