VAT Software Solutions

Karnataka State Budget 2015

The Hon’ble Chief Minister and Finance Minister of Government of Karnataka has presented the Budget for the year 2015-16 today. The highlights of Budget from VAT perspective are given below:

Commercial Taxes

  • Revenue collection target fixed at Rs.46,250 crores for 2015-16.

Value Added Tax

  • Successful implementation of online uploading of purchase and sales details.
  • Reliefs
    • Increase in registration limit from Rs.7.5 lakhs of annual turnover to Rs.10 lakhs.
    • Tax exemption on paddy, rice, wheat, pulses and products of rice and wheat continued for one more year.
    • Tax exemption on Footwear costing upto Rs.500 per pair, certain solar PV panaels and Solar invertors, Handmade products like Floor Mats, Table Mats and Runners, Utility Bags made of Banana Fibre excluding Rubberized Banana Fibre products.
    • Tax reduction from 14.5% to 5.5% on Wick stoves, Mobile phone charger, M-sand, M-sand manufacturing machinery/ equipment, Industrial cables namely XLPE Cables, Jelly Filled Cable, Optical Fibre Cable and PVC Cable,Pre-Sensitized Lithographic Plates used in printing industry, Packing materials like Pallets, Box Pallets and other Load Boards, pallet collars,
  • Additional Resources Mobilization Measures
    • VAT on Cigarettes, Cigars, Gutkha and ¬†other manufactured tobacco hiked from 17% to 20%.
    • Sales tax rate increased by 1% on Petrol and Diesel.
  • Rationalisation measure
    • Provision for single First appeal against re-assessment for several tax periods of one financial year.
    • Enhancement of period for disposal of appeal by KAT from 180 days to 365 days from the date of stay order.
    • Provision to claim input tax credit of previous tax periods in the returns, filed during subsequent tax periods by amending sub section 3 of section 10 of KVAT Act, 2003.
    • Provision to limit input tax credit to the extent of output tax paid on a particular commodity by amending section 11 of KVAT Act, 2003.
    • Provision to deduct tax at source, at applicable rate, on goods purchased by Government department or Local Authority or Local body or others.
    • Granting permission for Special Accounting Scheme is to be brought under 'Sakala.'
    • Enabling dealers to file an appeal electronically before the first Appellate Authority and to receive orders electronically.
    • Enabling the dealers to upload the details of CST statutory forms which will be linked to the turnover declared by the dealers in their returns.

Profession Tax Act

  • Reliefs
    • Reliefs Profession Tax exemption to senior citizens who have attained age of 60 years and above.
    • Professional tax exemption to persons drawing salary/wages less than Rs.15,000/- in a month.

Agricultural Income Tax

  • Reliefs
    • Replanting allowances hiked from Rs.900/- to Rs.2050/- per Metric Tonne Coffee produced.
  • Excise
    • Revenue collection target of Rs.15,200 crores fixed for the year 2015-16.
  • Additional Resources Mobilization Measures
    • Rate of Additional Excise Duty increased by 6% to 20% across all the 17 slabs.
    • Relief: New Karasamadhana Scheme providing relief on interest dues for those who pay the principal amount in respect of Arrack/Toddy rentals.
  • Stamps and Registration
    • The Sulabha Nondani Software will facilitate online time slot booking for registration of documents in any of the sub-registrar' offices in the district.
    • Kaveri Software and Bank Software will be integrated to facilitate farmers
    • Making the Banks, Financial Institutions etc., liable for payment or collection of proper stamp duty payable on optionally registerable documents
    • Additional resource mobilization of Stamp Duty have been rationalized through which Rs.125 crores of Revenue is anticipated.
    • Providing for composition/consolidation of duties in respect of certain instruments
    • Levying stamp duty on Chit Agreements and the Limited Liability Partnership instruments.¬∑ Rationalizing/ revising rates of stamp duty
    • Levying of one percent advalorem registration fee on agreement for sale without the possession of the property being delivered subject to a maximum of Rupees Two Hundred.
    • Levying of one percent advalorem registration fee on the market value of the property or the consideration whichever is higher, in respect of agreement for sale, wherein the possession of the property is delivered or is agreed to be delivered and one percent advalorem registration fee in respect of document of sale executed in pursuance of such agreement for sale, subject to a maximum of Rs.500/-.
    • Optionally registrable documents affecting immovable property will be required to be compulsorily filed online under section 89 of Registration Act, 1908.
    • The Revenue collection target for 2015-16 is fixed at Rs.8,200 crore.
  • Transport
    • Revenue collection target is fixed at Rs.4,800 crores for 2015-16.
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