The Hindu : Tax on 36 professions, new vehicles increased

Online edition of India's National Newspaper
Saturday, Mar 22, 2003

Southern States

Southern States - Karnataka

Tax on 36 professions, new vehicles increased

By Our Special Correspondent

Bangalore March 21. Higher tax on 36 professions, a two per cent increase in the ad valorem tax on new motor vehicles, higher entertainment tax, a two per cent reduction in stamp duty on sale of urban property, and reduction in excise fee on wholesale licences and clubs located in towns are among the major taxation proposals (other than commercial) in the State Budget for 2003-04.

Twelve more professions have been brought under the tax net and the professionals have to pay tax ranging from Rs. 1,000 to Rs. 2,500 a year. They are those providing billboards, city taxi operators, designers and landscaping consultants, Vaastu, Fengshui and other similar consultants, those providing placement services, IT call centres, multi-system operators (TV signal providers), yoga and reiki treatment and training centres, persons trading in replenishment licences and export- import scrips, online lottery centres and agents, security services, private radio broadcasting companies and operators, and astrologers, astropalmists, numerologists and faith healers. Some of the professionals in the Bangalore urban agglomeration will have to pay 50 per cent higher taxes.

The profession tax in the case of those earning a monthly salary ranging from Rs. 3,000 to Rs. 15,000 and above will range from Rs. 30 to Rs. 200 (an increase varying from 20 to 50 per cent). The tax at the highest range remains the same at Rs. 200 a month. Legal practitioners with a standing of five years in the profession (against 10 years hitherto) and less are exempted from tax. But in the case of seniors, the tax ranges from Rs. 1,500 to 2,500 a year depending on the place where they are practising. Similar is the increase for medical practitioners, technical and professional consultants, chartered accountants, engineers, architects and management consultants, and contractors.

Self-employed persons in the motion picture industry such as directors, and actors and actresses (other than junior ones) will pay a tax of Rs. 2,500 a year against Rs. 900. Journalists have to pay a profession tax of Rs. 1,000 a year against Rs. 600 and there will be no class differences. The composition rates for cable and satellite TV operators will go up from Rs. 3,000 to Rs. 7,500 a month in Bangalore, Rs. 2,000 to Rs. 4,000 (corporation areas other than Bangalore), and remain the same at Rs. 1,500 and Rs. 600 in other places.

Going by the recommendations of the Tax Reforms Commission, the Chief Minister has reduced the stamp duty from 10 to eight per cent on conveyances of property situated within the limits of the Bangalore Metropolitan Regional Development Authority and from nine to eight per cent for those situated in city corporation and municipal limits. The registration fee goes down from two to one per cent. A surcharge of two to three per cent on the stamp duty instead of the existing additional duty will be levied in municipality and taluk panchayat limits. The slab rates on the sale of apartments and flats will be removed and a uniform conveyance rate of eight per cent will be levied. In view of the rationalisation of stamp duty and registration fee, the concessions and waivers will be withdrawn from April 1, 2003.

While those sponsoring sports events are exempted from entertainment tax, an additional tax of Re. one and 50 paise per admission to air-conditioned and non-air-conditioned cinemas will be levied.

The motor vehicles tax applicable to various State transport undertakings has been increased from six to seven per cent in the case of vehicles operating on mofussil routes and three to five per cent in the case of city and town routes bringing them on a par with the rates applicable to private stage carriages.

The tax on tourist vehicles has been reduced from Rs. 2,250 to Rs. 2,000 per seat per quarter and from Rs. 4,000 to Rs. 3,000 per sq. metre on campers' vans to encourage tourism. The ad valorem tax on new cars, jeeps, and omnibuses has been increased from seven to nine per cent and, in the case of vehicles priced over Rs. 10 lakh, to ten per cent. The lifetime tax on new vehicles at the time of registration will vary from Rs. 12,000 (800 cc. and less) to Rs. 36,000.

There are increases and reductions in excise duty levies. For instance, the export duty on Indian-made Liquor has been increased from Rs. 2.50 to Rs. 3.50 a bulk litre and on beer from 50 paise to Re. one per bulk litre. The basic minimum price of liquor, excluding fenny, beer and wine, will go up to Rs. 350 per case for the purpose of levying additional excise duty and the latter will be Rs. 130 per bulk litre (minimum). However, the fee levied on wholesale licences for shops in municipal corporation limits with a population of over 20 lakh has been reduced from Rs. 8.25 lakh to Rs. 7.25 lakh. The licence fee in respect of clubs in municipality and town panchayat limits will be reduced from Rs. 70,000 to Rs. 60,000 a year and in respect of clubs in rural areas from Rs. 60,000 to Rs. 50,000.

In view of the drought, the concessions in respect of agricultural income tax will be continued in the coming financial year.

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