Sweets may soon ‘taste’ sour in Bihar. Cloths, use of cosmetics, lighting of houses and driving mosquitoes out of house are also set to become ‘costly affairs’.
In a far-reaching step aimed at internal revenue mobilisation, the state cabinet at its meeting chaired by chief minister Nitish Kumar on Tuesday approved a proposal to enhance value added tax (VAT) on a range of consumables made from flour, maida and besan like samosas, kachori, nimki, bhujia, salted peanuts, etc.
The cabinet has approved as many as 23 proposals, which include termination of non-practising allowance (NPA) for doctors, rechristening of College of Commerce as College of Commerce, Arts and Science, etc.
Briefing newspersons after the meeting, principal secretary, cabinet secretariat department, Brijesh Mehtrotra said cloths costing Rs 500 per metre or more and saris of value above Rs 2,000 and more would invite 5% VAT.
The government has imposed 13.5% VAT on packaged food made from flour, maida and besan. Till now, no VAT was applicable on such items.
Sweets costing more than Rs 500 per kg will become costlier, as they will be sold with additional VAT of 13.5%. Right now, they are sold tax free. VAT on dry fruits has also been increased from 5% to 13.5%.
Even building houses will be costlier as the government has decided to levy 13.5% instead of prevailing 5%, tax on sand, which is being sold without any VAT. Electrical equipment, industrial cables and inverters will also come with 13.5% tax.
Samosas, nimki, kachori, bhujia, potato chips, salted peanuts to invite 13.5% tax
Apparels costing Rs 500/metre and saris more than Rs 2,000 to be taxed 5%
Cosmetic materials, deodorants, hair oil, etc to invite 13.5% VAT
VAT on all types of UPS, dry-fruits, motor and battery parts raised from 5% to 13.5%
13.5% tax to be imposed on all brands of mosquito repellents, foam sheets.