Login
TRA launches India’s largest report on Educational Institutes

HINDU COLLEGE IS INDIA’S MOST TRUSTED, IIT-D IS SECOND, LOYOLA-CHENNAI, THIRD New Delhi, August 22, 2014 - INDIA. Hindu College, Delhi, has been voted India’s Most Trusted Educational Institute in a study by TRA (formerly Trust Research Advisory), a brand analytics and insights company. The study, titled ‘India’s Most Trusted Educational Institutes – 2014-’15’ (MTEI) was conducted am

Canon kicks off ‘repositioning’ campaign for its Inkjet consumer printers

Canon builds momentum with a new marketing drive for its stellar products – the PIXMA Ink Efficient Printers. Budgets INR 18 crores in advertising & promotions this year for consumer inkjet printers. The PIXMA product line-up includes ink efficient printers with print cost as low as 99 paisa. Canon plans to capture25% market share in the printer categoryby end of 2014 in line with pur

DHL presents Masaba Gupta and Amit Aggarwal at the opening show of Lakmé Fashion Week Winter/Festive 2014

Masaba Gupta and Amit Aggarwal opened the five-day fashion extravaganza with a refreshing and contemporary couture collection DHL is the Official Logistics Partner for Fashion Week in 11 countries across four continents and continues for the eighth year in India   Pune, August 22,  2014: DHL, the world’s leading logistics provider, presented young designers, Masaba Gupta and Amit Agga

BONJOUR GAINS FOOTHOLD IN THE YOUTH HUB, KAMLA NAGAR WITH A SWANKY NEW STORE

New Delhi, August 21, 2014 - BONJOUR, the leading socks brand of the country opened its brand new store in the heart of youth hub, Kamla Nagar. It is a lively market epicenter and a popular hang-out hub for the college crowd as it is surrounded by leafy and broad avenues dotted with the famous collegesof Delhi. This marketis famous for its popularfashion brands and spicystreet food, so Bonjour'sen

Agri-Biz show India Foodex in Bangalore from Aug 22

Hyderabad, August 21, 2014 - The three-day sixth edition of India Foodex that will showcase the latest products and technology in the food processing and packaging sectors will kick off in Bangalore from August 22. This holds significance in the context of the new target of the Ministry of Agriculture to double production of all food crops through the National Food Security Mission. S Jafar Naqv

Advaiya launches Digital Marketing Effectiveness offerings for Start-ups and small businesses

New Delhi, August 21, 2014: Advaiya Solutions, a technology and marketing services company launches its packaged offerings for 'Digital Marketing Effectiveness' for start-ups, small businesses, and new business ventures. Advaiya defines these digital marketing packages to suit different outlays and contexts. With Advaiya’s ‘Digital Marketing Effectiveness’ packages, entrepreneurs can start d

Medical technology needs SME focus

Industry has potential to touch $50 billionby 2025, says CII report New Delhi, August 21, 2014 : Small and medium enterprises in the medical devices and technology sector need more focus for the industry to reach its potential, says Himanshu Baid, Managing Director of Poly Medicure, a medical devices maker. About 60 per cent of the medical technology industry comprises of companies with turnove

From Bonita, a Travel Treat for all you wanderers!

An Accessory Organizer, Travel Treat will ease your journeys with its handy design, which is compact, stylish, convenient and practical The compressed structure that is expandable and washable allows you to fit in multiple items of need together on a journey New Delhi, August 16,  2014: For many of us who are frequent travelers, it is fairly common to forget something at home as we

Sunstrike Telecom launches Rage Freedom+ on Independence Day

Features that include an incredible 30-day battery back-up, digital camera, auto call recorder, Bluetooth make it a truly power-pack mobile handset Specifications · Dimensions – 125x53.2x14.5 mm · Weight – 106gms · Screen Size : 6.1 cms (2.4”) · Battery 3200mAh · Camera Digital with video recorder · Recorder Auto call · FM Radio · SIM SLOT – Dual · Audio/Vid

Development of Cottage Industry

New Delhi, August 14, 2014 - Development of cottage industries is mainly the responsibility of the State Governments. However, The Ministry of Micro, Small and Medium Enterprises (MSME) supplements the efforts of State Governments for promotion of khadi, village industries and coir through a number of schemes implemented by Khadi and Village Industries Commission (KVIC) and Coir Board. The detail

Financial Needs of MSMEs

New Delhi, August 13, 2014 - As per recommendations of the Prime Minister’s Task Force on Micro, Small & Medium Enterprises (MSMEs) Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) have launched their SME (Small & Medium Enterprises) platforms in 2012 exclusively for the listing of SME enterprises. 68 SME companies have since been listed on SME platforms of these exchanges.

Canadian e-comm firm Shopify bets on small enterprises to boost biz

Mumbai, August 11, 2014 - With a mere Rs.800 a month, you can start your own e-commerce platform. Canadian firm Shopify, an e-commerce software firm that allows anyone to easily sell online, said there is a huge market for small and medium enterprises to tap consumers by getting onto the online retail platform. The company said that following the recent spate of investment in the e-retail space,

32 Member High Powered Industry Delegation from FKCCI on visit to Canada and Alaska from August 11 2014

Bangalore, August 11, 2014 - A high powered 32 member delegation led by Mr. S Sampathraman, President, FKCCI is leaving for Canada and Alaska on the 11th of August 2014 to explore the possibility of Trade and Investments between the two countries. Canada is consistently ranked as one of the best countries in the world to invest as it has a strong, stable economy and vibrant, cosmopolitan cities t

Make Rakhsha Bandhan a Memorable Experience with Sunstrike Telecom’s Rage Swift

New Delhi, AUGUST 11 , 2014:With Raksha Bandhan round the corner, Hong Kong-based Sunstrike Telecom has launched its new phone in the market -- Rage Swift that comes with KiKat, the latest version of Android operating system and offers exciting features at an unimaginable affordable price, making it a perfect gifting option. The 3G phone with a substantial screen size of 8.9cms provides custome

CRISIL Training Calendar: August - September 2014

New Delhi, August 07, 2014 - CRISIL RESEARCH EXECUTIVE TRAINING CALENDAR : AUGUST - SEPTEMBER 2014    PROGRAMME TITLE DATES LOCATION Certificate Programme on Working Capital Appraisal and Monitoring August 07-09 New Delhi Retail Collections August 11-12 Mumbai Certificate Programme on Term Loan Assessment - Domestic and For

Industry Videos

Events
Holiday Expo-Vadodara,  08-10 Aug 2014

Holiday Expo-Vadodara, 08-10 Aug 2014... Holiday Expo is a leading trav

GIFTS INDIA - STATIONERY ASIA - PENWORLD

GIFTS INDIA - STATIONERY ASIA - PENWORLD... Gifts India - Stationery Asia

INDIA FURNITURE EXPO – 2014

INDIA FURNITURE EXPO – 2014... After Landmark Success in 2013

 FOOD TRADE EXPO'2014 exhibition - 04-06 Aug 2014

FOOD TRADE EXPO'2014 exhibition - 04-06 Aug ... Aakar Exhibition in associatio

Gifts World Expo - Delhi, 01-03 Aug 2014

Gifts World Expo - Delhi, 01-03 Aug 2014 ... The Gifts World Expo is one of

Swayamvar- The Bridal Exhibition - 01-03 Aug 2014

Swayamvar- The Bridal Exhibition - 01-03 Aug ... Swayamvar - 2014 (Surat) is a

Lifestyle Connoisseur - 31 Jul-01 Aug 2014  New Delhi

Lifestyle Connoisseur - 31 Jul-01 Aug 2014 N... The Lifestyle Connoisseur is a

Karnataka SME’s Excellence Award 2014

Karnataka SME’s Excellence Award 2014... An initiative of The SME Time

SME News

New Delhi November 26,2013: There is a need to ensure easier...
Rss  
Corporate Comm India The SME Times The SME Times portal present
How SMEs can make th  By: Sudhanshu Arora, Co-founder, Director
Meet on secret of suKochi, October 06, 2013: The Kerala State Sma
HRD Minister Dr M M New Delhi, September 05, 2013: The Human Reso

Investments

New Delhi December 3,2013: Based on the recommendations of F...
Rss  
REPL raises 100 cro New Delhi November 27, 2013:  REPL one of
Alamak Capital intro New Delhi, November 22, 2013 :  Alamak C
3rd BRICS InternatioNew Delhi November 19,2013: Corporate Affairs
Richard Bruton TD, I Mumbai, Maharashtra, India, November 19, 20

MSME News

New Delhi December 03,2013: Shri K. H. Muniyappa, Minister o...
Rss  
CII meet on manufactHyderabad December 2, 2013: The share of manu
NIESBUD – PromotinNew Delhi November 22, 2013: The National Ins
Technology Centres i Ambala 24th October 2013:Shri K H Muniyappa
Ministry of MSME AppNew Delhi, October 09, 2013: The Minister of

Technology

 New Delhi October 30, 2013 :Given the huge requirement of ...
Rss  
IT sector on the cusNew Delhi, October 13, 2013: Talk to any anal
Better UX has the PoNew Delhi, October 02, 2013: Tech for tech’
Proposal of GovernmeNew Delhi, September 21, 2013:  The Cabinet
The Clouds EconomyPoland, September 18, 2013: The Clouds Econom

Banking & Finance

Bangalore Nov 5, 2013: Mr. R. Shivakumar, President , FKCCI...
Rss  
Government Approves Ahmadabad October 30,2013 : Based on the rec
ICICI Prudential AMC Bangalore 23rd  October 2013:Highlights
HDFC Ltd. Financial Mumbai, Maharashtra, India, Tuesday, October
Siddharth Shah reeleMumbai, October 13, 2013: Siddharth Shah toda
Normal 0 false false false EN-US X-NONE X-NONE MicrosoftInternetExplorer4 st1\:*{behavior:url(#ieooui) } /* Style Definitions */ table.MsoNormalTable {mso-style-name:"Table Normal"; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:""; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin:0cm; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:10.0pt; font-family:"Times New Roman","serif";}

 

 

 

Federation of Karnataka Chambers of Commerce & Industry

 

STATE PRE-BUDGET MEMORANDUM – 2012 - 13

 

Mr. J.R. Bangera

 

President

 

Mr. K. Shiva Shanmugam

 

Sr.Vice-President

 

Mr. R. Shivakumar

 

Vice-President

 

Mr. N.S. Srinivasa Murthy

 

 Imm.Past President

 

Mr. B.T. Manohar

 

Chairman, State Taxes Committee

 

Mr. L.S. Raghavendra Sharma

 

Co-Chairman, State Taxes Committee

 

Mr. A. Ramakrishna

 

Secretary General

 

Ms. Lillu Aswathiah

 

Jt. Secretary

 

Federation of Karnataka Chambers of Commerce & Industry

 

State Pre-Budget Memorandum

 

 2012-13

 

PREFACE

 

Karnataka has always been at the forefront of industrial growth. It has provided an ideal choice for investment opportunities both from domestic and overseas investors. The Government needs to develop the State by improving infrastructure by moving at a fast pace on several mega infrastructure projects.

 

Initiation of stage wise e-governance in the Government Departments is a right step, supporting tax reforms and easing procedural aspects.  Total e-governance is the need of the hour, to simplify tax laws and cut the cost of compliance. This budget should pave the way for a smooth shift to the GST regime.

 

After gathering the opinion and suggestions from our affiliated members of Trade, Industry, Service sector, Associations and Chambers of Commerce from all over the State, we put forth our suggestions for due consideration by the Government.

 

                                                                         

 

K. Shiva Shanmugam    

 

Sr Vice President

 

February 21, 2012

 

Federation of Karnataka Chambers of Commerce & Industry

 

State Pre-Budget Memorandum -  2012-13

 

FKCCI is confident that the Government in this budget will make a renewed effort to simplify the procedural aspects of e-governance, improve business friendliness of State Tax Administration and improve compliance thereby increasing the revenue of the State.

 

The E initiatives introduced by many Departments are welcomed as they would reduce the interface between the Business and Government, however care needs to be taken to make these initiatives as dealer friendly as possible, for easy compliance and also to generate more revenue to the Government.

 

The proposed Karnataka’s budget has a special significance because this year is the first year of the 12th Five Year Plan. Hence, FKCCI feels that this budget should devise a well thought of road map for the Plan by taking appropriate development strategies and appropriate tax structure. Also, this budget can be evolved in such a way that it can be a guide for a smooth shift to the GST regime.

 

It won’t be out of place to present a brief review of the 11th Plan that ended with 2011-12.

 

Karnataka is one of the states which has a fairly good growth rate during the 4 year period of the 11th Plan, 2007-2011. As can be seen from Table-1, the GSDP of Karnataka at constant 2004-05 prices has registered a CAGR of 7.6% which is close to  the CAGR of 7.9%  India’s GDP  in the five years of 11th Plan 2007-2012. It is also evident from the Table that growth, both in Karnataka and India, is largely propelled by the Services sector.

 

                                              Table-1

 

 

 

 Karnataka GSDP during 4 Years of 11th Plan

( At 2004-05 Prices) - Rs Lakhs

 

 

 

Agriculture

 

 

 

 

 

Forestry &

Mfg.

Industry

Services

GSDP

Year

Fishing

 

 

 

 

2007-08

3740508

4186928

7081551

11966968

22789027

2008-09

3805663

4566231

7324959

13054529

24185151

2009-10

3908729

4766943

7663756

13551922

25124407

2010-11

4138330

5232727

8227683

14769633

27135646

CAGR

Karnataka

5.5

7.4

6.5

8.8

7.6

CAGR

India

3.27

7.1

6.7

9.9

7.9

 

          

 

Note:  1. Industry includes: Manufacturing, Mining, Construction and   

 

              Electricity

 

          2. CAGR – Compound Annual Growth Rate during the 4 years of

 

              11th  Plan

 

          

 

Source: Department of Economics & Statistics, GoK and  CSO

 

The fact that the growth is mostly propelled by the Services sector is also evident from the fact that the reduction in the share of agriculture and allied sectors in State’s GSDP from 16.2% in 2007-08 (first year of the 11th Plan) to 15.3% in 2010-11 (the fourth year of 11th Plan) is largely made up by services whose share has increased from 53.1% to 55.2% during the same period. The share of manufacturing has almost been constant at about 18.5%. Even the share of total industry including mining, construction, manufacturing and electricity has been constant at around 30% during the 11th Plan (Table-2)

 

 

 

                        

                                     Table-2

Karnataka GSDP at 2004-05 Prices - % share in GSDP during 4 years of 11th Plan

 

 

Agriculture

 

Industry

Services

 

Forestry &

Manufacturing

 

 

Year

Fishing

 

 

 

2007-08

16.2

18.2

30.7

53.1

2008-09

15.7

17.8

29.0

55.3

2009-10

15.6

18.5

29.9

54.5

2010-11

15.3

18.7

29.6

55.2

 

              Note:  1. Industry includes: Manufacturing, Mining, Construction and Electricity

 

              Source: Department of Economics & Statistics, GoK

 

This is somewhat a disturbing point because the decline in the share of agriculture and the static position in the Industry in general and manufacturing in particular will also affect the creation of employment opportunities. Since these two sectors are major ones which would add to employment opportunities, there is a strong need that the 12th Plan policies should be evolved around the main aim of strengthening these two sectors. This year’s budget, thus, can play a major role for evolving the growth strategies.

 

Regional Disparities

 

It is important to note that despite outstanding performance of the Karnataka economy along with exceptional performance of industrial and service sector, the outcome in terms of regional distribution of income is not very encouraging. The distribution of income generated from industry and service sectors are largely concentrated in a few pockets of the state. Of the total income generated from Manufacturing in 2008-09, 59.6% is generated from Bangalore Urban and Rural alone. As can be seen from table-3, about 81% of the total manufactured income in Karnataka is generated only in 9 districts and the remaining 19% is from 21 districts. Similarly 66% of the income from services is also generated in 2008-09 from these 9 districts. Only in the case of agriculture and allied sectors, the reverse is true. (Table-3)

 

 

 

The un-Irrigated plateau zone of Northern Karnataka and that of central & southern Karnataka are the main lagging regions of the state and these must participate in the mainstream growth. Also, as pointed out in Karnataka Vision 2020, regional disparities is a significant  challenge.As per Vision 2020 (Quoting Dr.Nanjundappa Committee’s report), of the 114 backward taluks in Karnataka (of total 175 taluks in Karnataka), 59 Taluks are located in North Karnataka and 26 taluks of the 59 ‘most backward’ taluks are also situated in North Karnataka. The growth can’t be inclusive unless it is well distributed across all districts.

 

Table-3

 

Share of District's GDDP in State's GSDP in 2008-09

at 2004-05 Prices (%)

 

 

 

 

 

 

 

 

Sl.

No

District

Agriculture &

Mfg.

Industry

Services

GDDP

 

 

Allied

 

 

 

 

1

Bangalore

2.2

55.6

42.9

37.0

34.1

2

Bangalore Rural

1.5

4.0

2.9

1.9

2.1

 

Total Bangalore

3.7

59.6

45.8

38.9

36.2

3

Belgaum

8.4

5.0

5.2

4.8

5.4

4

Dakshina Kannada

3.6

4.4

4.7

5.9

5.4

5

Mysore

4.0

3.5

4.0

5.0

4.6

6

Bellary

3.1

2.1

5.2

4.4

4.4

7

Tumkur

6.1

2.2

2.8

2.8

3.2

8

Gulbarga

5.0

1.4

2.7

3.3

3.4

9

Dharwad

2.2

2.7

3.0

3.3

3.1

Sub-Total 9 Districts

36.1

80.9

73.4

68.4

65.6

Rest of Karnataka 21 Dists

63.9

19.1

26.6

31.6

34.4

 

Total Karnataka

100.0

100.0

100

100

100

               

 

 

 

The growth process generating inequitable distribution of income across the state is not desirable outcome as far as welfare of the people is concerned. It is against the future of economic growth as well as the vision of the state that seeks for …….eliminating of poverty and deprivation at all levels and …promoting equitable growth covering all sections of people and regions of the State (Karnataka Vision for Development – 2008; page 18).

 

The absence of the growth opportunities in socio-demographic and economically vulnerable regions has far deep implications for welfare of the State since it perpetuates more economic backwardness and social structure dominated by caste and class characteristics.

 

Though industrial and service sectors have shown outstanding growth performance in the state, their success still has limited appeal  for:  a) large mass of population and b) for sustainable and inclusive growth character of State economy

 

Suggestions

 

In this scenario, the strategy should proactively focus upon growth concerns of agriculture and Industrial sectors, which would yield maximum welfare benefits to State. The economic growth to be sustainable and socially acceptable, it must assure benefits to all quarters of society. These two sectors provide maximum possibility of the above. In current market-cum-state framework, the benefits of economic growth are anticipated through trickled down mechanism and active state policies promoting growth process that are inclusive. In the development efforts of the State, agriculture and industrial sectors still has significant roles to play. The promotion of agro-based industries and small scale industries in socio-economically vulnerable and backward districts would be effective strategies towards achieving inclusive and sustainable growth.

 

INFRASTRUCTURE

 

World-class infrastructure is the key to faster development of Karnataka’s economy. Good road and rail network is the fundamental requirement for rapid growth of Trade & Industry, Tourism and overall development of Karnataka, as it provides connectivity to remote areas and access to markets, besides opening up backward regions to trade and investments.

 

RAIL-ROAD CONNECTIVITY

 

Government has envisaged in its Vision Document of Karnataka 2020 to tap the entire potential available throughout the State for development of existing 15,000 KMs of State Highways for easy access from one District Center to another as well as Taluk Centers and provide easy mobility and smooth access to the remote State Border Areas under State Highways Development Projects (SHDP). Fresh initiatives have been taken to mobilize funds to the tune of Rs. 13,363 crores under Public-Private Participation (PPP), Leveraging, Toll Revenue Departments, Budgetary Resources and also funds from External Resources. This together with Rail-Road connectivity will give the much needed boost for rural prosperity.

 

This initiative in bringing all areas in the State connected would bring  a manufacturing revolution in rural areas by encouraging the entrepreneurs to set up Industrial Corridors on the connecting roads. It will help particularly, Medium, Small and Micro Industrial Areas which in turn could help in reducing migration to urban areas by providing employment in respective rural areas.

 

One of the main reasons for low price realisation by the farmer for his produce is the lack of connectivity to the markets and consumer places, which in fact is the major requirement in building up a proper supply-chain. Improving connectivity would help in reducing  income disparities to a great extent & also help boosting exports.

 

There is another factor that brings urgency to this task of building road connectivity and also to strengthen the existing roads.  Our industry and trade are losing their competitive advantage because of the limited carrying capacity of our roads.  Bad roads are not only unsafe, but they also result in unacceptable levels of wear and tear, and waste of energy. 

 

Keeping the above in mind, FKCCI urges the Karnataka Government to give significant importance to this sector in the ensuing budget. Some of the major suggestions are listed below.

 

Shiradi to Mangalore Road

 

Ghat portion from Shiradi to Mangalore Port, a stretch of about 27 kms road is without surface. In fact, basic road does not exist there. Surface of the road is torn and worn-out and is in such a bad shape that it is not motorable and poses danger to vehicles and passengers. Most important fact is that this road also hinders movement of container traffic to New Mangalore Port. Being the main source of connectivity from State Capital and Mangalore, the only outlet major port in Karnataka, this bad stretch has become a nightmare for the export traffic to Mangalore and is adding to unnecessary costs.

 

In order to make the movement of goods smooth and faster, it is very pertinent that the Government should evolve a proper plan/design for road in this section, so also elsewhere, approved by the competent authority or expert in road building and execute the work with proper supervision to ensure quality and capacity to withstand heavy vehicular traffic. FKCCI urges that  separate funds should be earmarked for this important project.

 

It is understood that about 3,714 km of roads across 189 rural Assembly constituencies in the State, @ 20 Kms per constituency, had been developed in the first phase of Namma Grama Namma Raste during 2011-12 and another 30 Kms of roads per constituency would be developed during the next two years. This indeed would be a significant beginning to the 12th Plan and should be accelerated to 40 Kms per constituency very soon so that by the middle of 12th Plan all villages in Karnataka are connected by roads.

 

Development of NH 17, NH 48 and NH 13

 

There is an urgent need to upgrade and develop the important NH 17, 48 and 13 which are connected to Port facilitating the hinterland development.  The State Highways are to be developed and the roads connecting inter-State are to be 2 laned for speedy movement. 

 

Express Highways

 

For facilitating the fast developing industry and trade, express highways play a major role. One of the factors that made China a manufacturing-hub today is the huge 85000 KMs expressways it built in about 23 years.

 

The Union Road Transport and Highway Ministry plans to set up a network of 18,000 km Greenfield expressways across the country by 2022. Karnataka Government can take an active lead in this programme. The proposed Chennai-Bangalore expressway with the help of Japan could be an example.

 

For becoming a leading industrial hub in the country as also to become the  leading economic state in the Country, Karnataka Government has to speed up its plans for better connectivity between major industrial hubs and the ports.  This budget could be the beginner for this major programme.

 

 

 

PORTS

 

Tadri Port

 

 

 

There  is  a good  scope  to  develop  this   port  with  modern infrastructural  facilities.  Konkan - Railway  line and  N.H.17 are passing  very close  to  the  port area. Also N.H.63 and  proposed Hubli - Ankola  Railway  line and  Honnavar  Tumkur  N.H. 206 are added infrastructural facilities  for  all-round  development  of  Tadri  port. This port has been  projected  for  development  under  BOOST  (Build-Own-Operate-Share and Transfer) concept through private participation. Vast area is available  for  development  of  this  port  with  negligible  rehabilitation  problems.  Tadri  port  has  got an  effective  hinterland of  about 2.00 lakhs Sq.Mts.  comprising of  Central and  Northern  parts of Karnataka and some parts  of  Andhra Pradesh, which  are rich in large deposits of  minerals, forests,   agricultural and marine wealth.

 

In view of the above, FKCCI urges the Government to make special efforts to build this port at a faster pace than is being done now.

 

We also urge the Government to develop all other minor ports so that the exports from Karnataka can be expanded to achieve a high US $ 100 billion by the end of 12th Plan.

 

RAILWAY LINES

 

Further to improve the rail infrastructure for speedy and economical movement of the goods, we request the Government to take up the following projects,  for immediate action, with Railway Ministry:

 

Hubli - Ankola  Railway  line

 

This line, which is in planning for many years now, should be taken up at an express speed.

 

  • Electrification of Bangalore-Tumkur,   Bangalore-Mysore
  • Doubling of track between Tumkur-Arsikere

 

To speed up the following works:

 

  • Almatti-Koppal,  Bagalkot-kuduchi,  Bidar-Gulbarga, Bangalore-Hassan
  • To approve the link between Chamrajnagar-Mettupalya,Tumkur to Davangere  via durga
  • To build a 2nd platform at Tumkur
  • Under the dedicated corridor North to South, Karnataka is to be included.
  • To provide high speed passenger rail corridor: Mumbai-Belgaum-Bangalore-Chennai

 

POWER

 

Low power availability would hamper the industrial growth. Efforts should be initiated in this budget, by way of new incentives, for increasing power generation through the “Renewable Energy Route” as is being done in Gujarat.

 

Subsidy for Irrigation Pump Sets consumptions (IP Sets)

 

The subsidy allocation for IP Set consumption is inadequate since the estimated consumption is around 12,600 million units and at the present average cost of Rs.4.50 the requirement would be Rs.5,670 crores. However Honble Commission has determined a tariff of Rs.1.21 p per unit which is not even meeting the Power purchase cost.In view of the provisions of Tariff Policy the Cross Subsidy component for any class of Consumers should be within + - 20% of cost of supply. Therefore the cross subsidies will be brought down to reach this mandate progressively by successive tariffs. Hence additional allocation of funds are to be ensured.

 

Losses on account of inefficient pumpsets which is estimated at 18 lakhs, is a highly exaggerated number & not in agreement with the census conducted by Minor Irrigation Department which works out to 11-12 lakh IP sets only. Not withstanding this anomaly, it is suggested that an external agency be invited to replace all the irrigation pumpsets with an assurance that a certain percentage of saved energy will be allowed to be claimed as deemed generation. This will largely bring down IP set consumption and make the saved energy available for other productive purposes.  It is estimated that efficiency of the existing IP sets is around 40% only. 

 

Further, it is suggested that a policy direction from the State Government be issued under Section 108 of Electricity Act 2003 exempting payment of electricity charges by the irrigation pumpsets for a period of 10 years subject to these installations accepting to install metering. At the moment the entire attributed consumption of 12600 MU is only estimation and is causing a heavy burden on the States exchequer.

 

ADDITIONAL GENERATING CAPACITY

 

In addition to the major Thermal plants coming up in Kudgi in North Karnataka, small capacity Solar, Wind, Biomass hybrid versions of Power generation are to be started in every District of the State, with minimum of 4-5 mega watt capacity, to augment the needs of Water in Hospitals and Educational Institutions.

 

INDUSTRY

 

For the overall, well balanced and inclusive development of Karnataka, development of industry has to take a major role in the ensuing 12th Plan. As mentioned in the beginning, there is an element of regional disparity in the growth of Karnataka. This is evident in the case of Industry as well.

 

When we look at the regional spread of industrial units and employment provided by them, the picture appears to be grim (Table 4). They are largely concentrated in the same districts that are mentioned above. What makes this unique feature of industrialization and economic growth in the state is creation of central growth poles concentrated in a few regions. What one may call this is realization of backwash effect in Karnataka economy growth dynamics.  Wealth and labour move from poorer, peripheral areas to more central regions of economic growth and the industrial production of wealthy regions may well undercut the industrial output of the poorer regions. This draining of wealth and labour together with industrial decline is the backwash, or polarization effect. The out migration trends from the poorer regions of State to relatively developed one explains much of this phenomenon. 

 

                                                  Table-4

 

Regional Concentration of the Industrial Units and Employment

 

 

 

 

Percentage Share of Each District

Factory Units

Emp-loyment in factory Units

SSI Units

Emp-loyment in SSI Units

BANGALORE

50.59

57.41

17.1

27.2

BANGALORE(R)

3.31

5.47

4.3

4

Total Bangalore

53.9

62.88

21.4

31.2

BELGAUM

5.51

5.18

8.5

6.3

DAKSHINA KANNADA

4.26

3.32

5.1

4.5

MYSORE

4.75

4.41

5.8

5.2

BELLARY

3.16

3.11

4

3.4

TUMKUR

2.89

2.12

5.5

5

GULBARGA

0.83

1.11

4.1

3

DHARWAD

4.17

2.2

4.2

6.1

Sub-Total

79.47

84.33

58.6

64.7

9 Districts

 

 

 

 

Rest of Karnataka

20.53

15.67

41.4

35.3

21 Districts

 

 

 

 

 

                 Source: Karnataka at Glance, 2009-10, GoK

 

This budget should make a beginning to change this scene. Development of the MSME, in the districts and places that have low industry spread, would be major step in this direction. Food processing industry can play a significant role in this effort. This budget can initiate action by providing the required support and incentives for the development in the areas that are neglected so far. Special schemes can also be evolved.

 

Taxes on Industrial inputs and consumer Goods.

 

The industrial sector is presently undergoing a slowdown in the country. The overall industrial production in the country during the first 9 months, April-December of 2011-12, has been much lower at 3.6% as compared to 8.3% during the same period in the previous year. Manufacturing sector also has a much lower growth of 3.9% as against 9% in previous year during the same period.

 

Falling domestic demand. Due higher prices, is one of the reasons for this. In view of this, FKCCI urges the State Government to reduce the VAT rates on all industrial and consumer products.

 

BOOSTING INVESTMENT

 

This slowing down has also adversely affected the investment environment.  Boosting investment in the present scenario, marred by uncertain economic outlook, called for an aggressive policy stance, introducing investment allowance, fast-tracking implementation of projects, providing boost to investment in infrastructure, simplifying tax and regulatory compliance.

 

LAND

 

In the development of infrastructure and industry, land is going to be an increasingly major hurdle. The recent problem in acquiring land for the proposed POSCO plant is point in this direction.  Government should initiate process to strengthen the land bank, preferably the non-arable lands. This budget should look into this aspect urgently because this would impact the ensuing GIM in June 2012.

 

TOURISM

 

Tourism, as an industry has gained importance in the last decade.  Tourism is a sun-rise industry which has huge potential to bring in economic and social changes.  There are nations who thrive on tourism alone.  It generates local employment and valuable foreign exchange to the government. Further, we need to show the world that Karnataka in particular, has world class tourist destinations with bounty of nature, archeological monuments, historical places and so on.

 

Karnataka is one state, many worlds with its mix of rural tourism, medical tourism, heritage tourism, adventure tourism, coastal tourism, heli tourism, entertainment, etc. Karnataka currently (2010) Ranks 5th for domestic tourist  with 38 million domestic arrivals and 11th for foreign tourist with 0.38 million of international arrivals. FKCCI is happy to note that the State Government recognizes  tourism as a major growth engine.

 

Our state has tremendous potential to improve its ranking very soon. Government should take the following steps for achieving this goal.

 

  • Augmenting staff strength of Dept of Tourism at major tourist destinations.
  • Establishment of  information kiosks at Railway Stations/Bus Stands
  • Organising Festivals in all regions, tourist centres,  in line with Hampi Festival.
  • Construction of yatrinivas, dormitories and guest houses at tourist destinations.
  • Botanical Garden at Harangi dam.

 

·         Development of Basavakalyan, Narasimha Zarna (Bidar Dist), Yana, Magodu Falls (in UK dist), Kandagiri (Chikkaballapur dist), hill ranges in Chamarajanagar, Alamatti (bidar dist) and various tourist spots at Davangere district

 

STATE TAXES

 

FKCCI has been repeatedly expressing its view that the State Budget should announce measures that pave the way for Economic Revival and implement schemes that provide impetus for Economic activity.

 

We do hope that in this budget the Government will consider reverting back to the VAT rate which was enhanced from 4 to 5% and 12.5 to 13.5% & last year to 14%, which will greatly help the common man, support the business and prevent trade diversion.

 

Continuation of exemption on Food Grains, Pulses & Wheat Products.

 

The Govt. of Karnataka vide notification No.FD 35 CSL, 11 dated:29-3-2011, had exempted the following commodities from VAT Tax, for a period of one year ending 31st March 2012,which should be extended for 1 more year.

 

1.   Paddy & Rice

 

2.   Wheat

 

3.   Pulses

 

4.   Flour and soji of rice and wheat

 

5.   Maida of wheat.

 

Sales Tax on  Petrol and Diesel:

 

The rate of tax on Petrol and Diesel is high when compared to Maharashtra and Andhra Pradesh States. This disparity in rates of taxes has resulted in diversion of trade to neighbouring states. Therefore the rate of taxes should be at par with neighbouring states. This will result in additional revenue to the Government.

 

Widening of Taxbase

 

There are many unregistered dealers who are causing unhealthy competition in the market. Therefore, an extensive, proper & systematic survey be conducted by the department to rope in potential unregistered dealers and widen the tax base.Further, VAT awareness programme is essential to lure such dealers for voluntary registration and also such dealers should not be heavily penalized if they approach the department voluntarily.  

 

Modernisation of Checkposts-Further, the checkposts should be modernised and the documents collected at the Checkposts should be cross-checked regularly in order to prevent revenue loss to the Govt.

 

These measures will enable the Govt. to increase the revenue and also promote healthy trade practices in the trade and industry.

 

Reforms

 

  • Make registration procedure very simple and timebound.
  • Introduce total automation of Commercial Tax Department with sufficient updated infrastructure.
  • To provide a Help-desk manned by technically and professionally trained personnel which should work 24/7 in all offices of the department throughout the State.
  • Public Awareness Programme for social responsibility towards payment of taxes and obligation of dealers to be carried out.
  • To conduct Orientation Programme for officials in the department on Law/ Procedures and to be made accountable.
  • To update information on Commercial Tax Website regarding Acts/Rules/Notification/Clarification under all Acts of Commercial Taxes.
  • VAT Advisory Board to be made functional and meet quarterly.
  • To ensure preparedness of the department for GST.
  • To reduce tax on motor vehicles so as to avoid people buying vehicles from neighbouring States such as Tamil Nadu, Kerala, Pondicherry, where Sales Tax is much lower than in Karnataka.
  • To increase the staff strength in the Commercial Tax Dept. as insufficient staff especially Commercial Tax Inspectors is creating difficulties to the dealers.
  • To reduce tax and make the cost of petrol and diesel on par with neighbouring States especially in the borders of our State.
  • Divisionwise Commercial Tax Consultative Committees to meet quarterly.
  • To explain determination of Total turnover – Sec.2 (35) Total turnover. The  words “turnover of purchase or sale in the course of inter-state Trade or Commerce to be explained.
  • Sec.27(1)(e) to provide proviso for an opportunity of being heard. – Reason for amendment to be provided in Form VAT 1.
  • Sec.40 (b) to be deleted.
  • Sec.53 (12) – No penalty to be levied if e-sugam is generated at the time of vehicle leaving the checkpost.
  • Sec.72 (1)(b) penalty – 1% of tax or Rs.500 whichever is lower if the default is not more than 10 days, 1% of tax or Rs.1,000 if the default is more than 10 days.

 

E payment-All scheduled banks should be enabled for E payment and the Department to accept Tax payments through RTGS/NEFT  as it is difficult for the Dealers to operate Current Accounts in the Banks notified by the Government. Till then the Scheme may be optional.

 

MSEs-Due to cash crunch faced by Micro and Small Enterprises (MSEs) on account of delay in receipt of payments from their customers, it is requested to allow MSEs to make e-payments once in a quarter, though the e-filing is done every month.

 

Deduction of tax at source Under Section 9-A requires to be made more effective:

 

A large part of construction activity is also under taken for entities who are non dealers such as Charitable & Educational institutions. Commissioner has not yet notified u/s. 9-A (1) such entities to deduct tax at source in respect of any  Works Contract executed for them.

 

COMPOSITION TAX paid by Works Contractors u/s.15(1)(b) and    u/s 15(5)(a)  , be made eligible for Input Credit:

 

W.e.f. 01.04.2006, under Rule 139(3) Works Contractors are permitted to collect composition taxes. Consequential amendment to section 10(4) is not made to include the word “bill of sale” after the words “a Tax Invoice…..”.

 

This prevents contractee/employer in claiming Input Credit of taxes collected by Works Contractors under composition scheme for end user dealer (contractee). This is a major set back in turnkey projects.

 

For Dealers Executing Works Contracts in Composition Scheme:

 

For Dealers covered under Section 15(1)(b), presently there is no provision in section 15 with respect to:

 

(a)To deduct value of Sales returns from turnover (returned within 6 months from date of sale) and to return the taxes (if any collected) as credit note cannot be issued by composition dealer.

 

(b) To carry forward to subsequent tax period, deduction in excess of turnover related to payments to sub contractors (Section 15(5)(b)).  This is typical to flat developers, who cannot book the turnover as buyers are few initially. 

 

Section 15(5)(a) requires more clarity:

 

i)             There is a need for clarity in respect of taxability of capital goods brought from outside the state, which are used in the works but are not passed on in executing of works.  Presently, our state is losing revenue in respect of such goods as value of such goods are not offered to tax u/s. 15(5)(a).

 

ii)      Providing deduction of sale value of goods on goods brought from outside the state, from turnover liable to composition, whereas purchases within the State  is at disadvantageous position, as there is no deduction from turnover for such local purchases.

 

iii)     The rate of tax applicable u/s. 15(5)(a), it is not clear as to whether the rate is as specified in section 4(1)(a)/4(1)(b) or 4(1)(c).

 

A works contractor under composition scheme has to pay tax at regular rate for purchase of taxable goods made from URDs as per Sec 15 (5) (e) in addition to paying tax on total contract receipt. If the same contractor purchases taxable goods from outside the state, the purchase value has to be deducted from the contract receipt of that month and the balance receipt is liable to tax at composition rate and the purchase made from outside the state is liable to tax   as prescribed u/s 4 of the Act. The reason is that the purchase made  has not suffered local tax at regular rate. The same method may be followed in respect of purchases made from URDs inside the state. Otherwise it will result in double taxation.

 

Making Best use of TINXSYS software in interstate trade:-

 

i)             At present, the data of interstate movement is monitored in TINXSYS software across India. As lot of discrepancies take place in interstate trade causing revenue leakages to states, it is fair enough to make best use of this software, by enabling dealers to get information of transactions taking place in their respective TIN number. For E.g.: Goods originating from West Bengal, destination Name & TIN shown as Karnataka but unloaded and sold in Andhra

 

Pradesh. If all dealers are having access to TINXSYS information about transactions pertaining to them, such malpractices can be prevented and revenue loss can be plugged.

 

ii)      Presently, other states have also made it mandatory to upload details of inter state movements in their website.  This leads to duplication of Work, as both seller/buyer has to upload in their respective States.  Instead, if this uploading is carried out in TINXSYS platform, a single uploading either by buyer/seller will comply with the requirement of both the states simultaneously.

 

Rectification of mistakes under Section 69:-

 

As per Section 38(1) all returns are deemed assessments. Whenever any judicial pronouncement favourable to dealer is pronounced, at present there is no scope for applying for rectification from dealers end. Therefore Section 69(2-a), be suitably amended to accommodate specific rectification of any mistake in a return, as being apparent from record.

 

Input tax restricted goods should not be subjected to tax again unless there is value addition:-

 

In respect of Input Tax restricted goods (section 11(3)) enumerated in Fifth Schedule of KVAT Act, 2003, especially goods covered under entry 1, 3, 4 & 5 when sold by dealers in subsequent years after usage, should not be subjected to Net Tax unless there is value addition over & above purchase value. As VAT is fully realized in respect of such goods initially and normally these goods are depreciable in nature fetching lesser value than cost, subjecting them again to net tax is unfair as there is no value addition at all.

 

For Example: Notification No. FD 115 CSL 2007(4), Bangalore dt.30.03.2007 subjecting used motor vehicles when sold to 5% net tax.

 

In case of hoteliers opting For Composition Scheme U/s.15(1)(C):

 

i)      Presently hoteliers opting for Composition u/s.15(1)(c) are not permitted to purchase goods for use in sale from outside the state. This puts them at disadvantageous position as to buying quality goods & price advantages. This anomaly to be set right by bringing them at par with Works Contractors u/s.15(5)(a).

 

ii)      Composition Scheme be extended to hotels serving liquor

 

Hotels serving liquor should be permitted to opt for composition, as liquor sales are outside the purview of taxation under KVAT.

 

Specific points For SEZ Unit/Developers:

 

  1. KVAT for entire area including Non Processing Area of Special Economic Zone be exempted instead of the present exemption by way of Refund route for processing area alone.
  2. Refund of KVAT should be expedited.
  3. Exemption for petroleum products for Special Economic Zone in KST be considered.
  4. Entry Tax should be exempted for petroleum products for Special Economic  Zone.

 

5. Accord deemed export status to supply of goods to SEZ UNITS/ developers of SEZ’S in the State:

 

Supply to above dealers is Zero rated in interstate trade under CST Act, 1956. Whereas in KVAT Act 2003, tax has to be charged by suppliers and units of SEZ has to go for refund route of tax paid u/s.20(2), as refunds are not forthcoming or prolonged for a very long time.

 

  1. Declare the entire MSEZ and MRPL area as Industrial Township and single local area under KTEG Act, 1979.
  2. Increasing the exemption of Stamp Duty and Registration Fees to 100% in respect of the SEZ units.

 

Revision of Returns

 

Under the present law, returns are to be revised within a period of 6 month from the end of the relevant Tax period. The Commissioner circular specifies that if the return is filed belatedly and there is any tax payable by the dealer, then such revised returns above six months is acceptable by the dealer.No VAT/CR-31/2008-09 dtd 7.7.2008  

 

Suggestion:

 

We suggest that the time limit for the revision of the original return should be increased to nine months from the end of the financial year.

 

The law should not penalize the dealers when they have filed the revised returns within reasonable time. The dealer should be allowed to file the revised return above six months even though there is input tax credit which is yet to be claimed by the dealer. Even for dealers like works contractor, wherein the extended time for filing the revised returns due to many factors involved in execution of such contracts, should be  provided.

 

  

 

Audit

 

The law states that the audited statement of accounts shall be submitted in Form VAT 240 to the Jurisdictional Local VAT officer or VAT sub officer within 9 months after the end of the relevant year. 

 

Suggestions

 

We suggest that the Form VAT 240(Format of Audit report) should be separately drafted for composition dealer and KVAT dealer so that it will be convenient to the department and the auditor to extract the required information like monthly return (Form VAT 100/Form VAT 120). No departmental Audit be conducted by the VAT Authority, if Form  VAT 240 (Audit Certificate) is filed.

 

Audit under different Acts-It may be noted that, the audit is taken up separately by different officers at different point of time under different Acts - VAT, KTEG & CST Act. This takes lot of time of the assessee, as well as the department. Further, the department can also

 

take a comprehensive look on finalizing the audit, if the audit is covered under all the acts at one time with one officer.

 

Introduction of jurisdictional and pecuniary limits for Audit Officers:

 

Under the present law there are no jurisdictional and pecuniary limits for Audit Officer. This is causing inconvenience to the trading and business community. Therefore, it is suggested that precise pecuniary and jurisdictional limits may be prescribed for Audit Officers for effective implementation of the Act. This system was erstwhile in Karnataka Sales Tax Act. 

 

Concessional Rate-For all Karnataka Government and State Public Sector tenders, where there is last point of consumption, the dealers of Karnataka State should be allowed to charge VAT equivalent to CST to create level playing field with respect to bordering states, who are enjoying concessional rate of tax (CST) when compared to KVAT.

 

ADMINISTRATION

 

E Sugam to be further strengthened:-

 

Presently, this system does not reveal information to the other party (other than who uploaded data) about transactions (purchase or sale) made by using his TIN number.

 

If the E Sugam software is upgraded to enable the dealers to obtain summary of information of E Sugam movements taken place in their name (as purchaser/seller etc), the entire system can be made fool proof.

 

Clarification U/s. 59(4) by Commissioner to be made time bound:

 

Applications made to the Commissioner are not disposed expeditiously. It is therefore suggested that time limit be fixed within which the Commissioner has to clarify. This process should be subjected to reasonable time frame of say fifteen days.

 

Check posts to have weighing bridges:

 

The transporter faces lot of inconvenience due to lack of this facility at check posts. Also our state is losing revenue, wherever unaccounted over loading gets unnoticed due to lack of weigh bridges.

 

Returns-In VAT-100 and 120, the returns are titled as original / revised / corrected / final.       Sec.  35 (1) prescribes for filing of original return. Sec. 35 (4) prescribes for filing of revised return. Sec. 27 (4) read with rule 42 prescribes for filing of final return. But there is no mention in the Act or rules about the circumstances under which a ‘ Corrected ’ return could be filed.

 

In the recent amendment to the KVAT Rules, Form VAT-100 has been amended to prescribe Non deductible input tax in respect of purchase returns made in the month. There is some problem in furnishing the information when the input tax in the purchase return is more than the input on the purchases made in that month. The computer will not take negative value of input tax.

 

At present sales return is being shown box 2.1 of VAT-100 including out put tax. The dealers are facing problem in deduction under appropriate tax rate turnover and tax. There is also some difficulty in furnishing the information when the sales return turnover and output tax in sales return are more than the actual sales and out put tax in that month.

 

Refunds are not forthcoming as per Rule 128:

 

i)      Wherever refunds are claimed as due by dealers in monthly returns, the LVO/VSO’s are neither issuing refund orders nor rejecting it under Rule 128(3). This leaves the dealers in peculiar situation of indefinite waiting for refund, without genuine reasons for delay. This leads to indiscipline in tax management, shaking the confidence of tax paying community as the law cannot be different for Government & Dealer in payment/refund. In order to ensure discipline in refunds, Rule 128 should be strictly implemented.

 

ii)      Adjustments of Refunds:

 

The tax paid on account of order u/s.39(1) or on confirming orders by Appellate authorities which are  finally refundable on account of orders passed by competent authority or Court,  dealer should be given option to adjust for current demands by issue of proper orders in Form-250 by the LVO’s. At present there is scope for adjustment towards arrears only. This requires proper amendments in Rule 129(2).

 

SMR authorities to camp at Mangalore Hq:

 

Department is taking up sou moto revisions who have Head Quarters at Bangalore. The dealer has to travel to Bangalore to participate in proceedings. When the amount is small, the cost of participation is more and many times dealers abandon the proceedings on cost consideration. The suo moto revisional authorities may be directed to hold camp periodically at Mangalore Head Quarters in such cases.

 

Notice before creating demand for Non Filing Statutory Forms:

 

As per Amendment to the CST Act there is obligation to file ‘C’ Forms within next quarter. Failure to file ‘C’ Forms will result in deemed assessment and concerned LVO are issuing demand notice in Form VAT 210. An opportunity be given to file the ‘C’ Forms before issue of form VAT 210, so that appeal proceedings may be reduced.

 

Cancellation of registration & returns of NSC/Security Deposit:

 

Whenever application for cancellation of registrations are made on discontinuation of business, no  certificate of cancellation of RC are issued and refund of NSC’s pledged/security deposit are carried out by the LVO’s so as to make the finality of closure proceedings. A time stipulation may be made to issue cancellation certificate and return of NSC pledged/security deposit.

 

 

 

Setting time limit for conclusion of Reassessment proceedings after issue of notice of proposition.

 

1.           Dealers have option to move from VAT to COT or vice versa. Whenever such changes are done, revised returns pertaining to the earlier period are not permitted in the system. Due provision be made for revised returns in the e-filing system.

 

Dependency of Rate of tax on Central Excise Classification:

 

Notifications are issued for information technology products, capital goods to reduce the rate of VAT to 5%. The items specified in the notifications have been given in reference to their classification under Central Excise. It is suggested that the Changes in the Central Excise Tariff should be immediately incorporated in the State Law also otherwise the product rate will be disputed.

 

ENTRY TAX

 

  • Sec.17(A) proviso for retention of books of account – years to be specified.
  • Sec.5 (6) notification for acceptance of returns for the period 2006-07 &  2007-08 to be issued as the period is timebound.

 

Petrol, Diesel, Oil & Lubricants-Petrol, Diesel, Oil & Lubricants are subjected to Entry Tax of 5%. These commodities are not subjected to Entry Tax in neighbouring states of Maharashtra, Andhra Pradesh and southern states resulting in disparity in the rates of taxes, which in turn causes diversion of trade.Therefore, it is requested that, Entry Tax on these commodities be removed.

 

Sugar- To be exempted from Entry Tax or reduced to 1/2 %

 

Textile- To be exempted from Entry Tax

 

Cutting Tools- To be exempted from Entry Tax

 

MOTOR VEHICLE TAX:

 

  The existing system of Road Tax on vehicles is as follows:-

 

 

 

                     Vehicle Cost (Rs.)                                  Total

 

                      Upto 4,99,999                             14.43%

 

                      5,00,000 to 9,99,999                   15.54%

 

  10,00,000 to 19,99,999                      18.87%

 

                    20,00,000 and above                   19.98%

 

Due to lower rates prevailing in neighbouring states of Kerala, Pondichery etc, the higher end new vehicle purchases and registration is taking place there and besides vehicle tax our state is loosing 14% KVAT on vehicle sales also. Hence rates adopted by neighbouring states be followed to prevent trade diversion.

 

PROFESSION TAX – Age limit for Profession Tax

 

  • Presently the age limit for Senior Citizens under this Act is 65 years which should be reduced to 60 years as done under the Income-tax Act.
  • It is suggested to increase the turnover limit for determining the Profession Tax payable by dealers registered under the Act as below:

 

     Upto Rs.5 lakhs                                  ..      Nil

 

     Above Rs.5 lakhs & upto Rs.25 lakhs     ..      Rs.1,000

 

     Above Rs.25 lakhs & upto Rs.50 lakhs    ..      Rs.1,500

 

     Above Rs.50 lakhs                              ..      Rs.2,500

 

  • Thresh hold limit of Professional Tax for salaried persons to be raised to Rs.15000.

 

STAMP DUTIES

 

  • Stamp duty leviable on purchase of property is too high leading to under valuation.  If the stamp duty is lowered there will be better compliance.
  • Stamp duty for registration of partnership deed should be brought down to Rs.100 from the present duty of Rs.1,000.  For change in constitution the documents should attract stamp duty of Rs.100 only.

 

APMC

 

  • The APMC Cess to be reduced from 1.5% to 0.5 %.
  • Payment of APMC Cess to be extended to one month instead of weekly payments.

 

Members Suggestions

 

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        Rate of Taxes

 

 

 

Commodity/Industry

Suggestion

Powder Refractories

Bricks attract 5% KVAT where as powder refractories attract a KVAT of 14.5%.It is requested to bring down the KVAT rate for powder refractories also to 5%.

Fabricated Structural Steel

To fix a  concessional  rate of sale tax of 2 per cent  upon sale of Fabricated Structural Steel as a product   Or  Consider the products of Fabricated Steel Structural   as a capital goods and thereby fix the rate of KVAT at the rate of 5 per cent

 

Wheat & Wheat Products

VAT exemption may be extended for the period 2012-13 also.

 

Pulses & Food Grains

KVAT exemption on Pulses, Food Grains, Wheat & Wheat Products, & other Essential Flour Items should be continued.

Gold jewellery/silver articles/medallions

Kvat on gold jewellery/silver articles/medallions increased to 2% last year to be reduced to 1%.

 

Paint Brushes

The rate of tax on paint brushes to be brought down from 14% to 5% as  most other states charge 4 to 5%.

 

Supplies made to Central & State Government Departments / Boards /

    Corporations and undertakings

Taxes should be exempted or brought to 4%

   only,so that  parity will be maintained throughout the Country

Hotels

  • The turnover limit to be increased from 5 lakhs to 50 lakhs
  • 2% tax to be levied for those who cross 50 Lakhs  turnover
  • Per day Room Rent at hotels to be increased from Rs.500 to 1,200  

 

Oil Seeds & Oil cake and cotton seeds

To be reduced to 2% & make CST 2 % to avoid refunds

 

Paper envelopes and student Note Books

 To be exempted from KVAT

 

Office files made of paper boards

Should be included in the entry of Paper & Paper Boards.

 

Pooja Articles

Which are presently taxed at 13% to be exempted

 

Mosquito Nets & Repellents

 

To be exempted

 

Dry fruits

The rate of tax to be reduced from 14% to 5%

 

Bicycles, Tricycles, Parts, accessories, tyres and tubes

To be exempted

Electrical goods

To be reduced from 14% to 5%

 

Petrol & Diesel

Sales Tax to be reduced on par with the neighbouring States

 

Footwear

Costing less than Rs.500/- to be exempted

 

Rolling shutters

Presently charged at 14% to be reduced to 5%

 

Fried Gram

Presently taxed at 5% to be exempted

 

Glassware and crockery

To be reduced from 14% to 5%

 

Aluminium utensils

To be exempted

 

Earthern roofing tiles (clay)

To be reduced from 14% to 5%

ERW steel pipes and tubes, electrical conduit metal

To be included in the 3rd schedule of KVAT Act

Madeups (towels, bedsheets and shoddy blankets)

Rate of tax to be brought in par with neighboring States

Tamarind

Presently taxed at 2% to be exempted

 

Red Chillies

To be exempted

 

Dhanya

To be reduced from 5% to 2%

 

Water Supply Valves

Presently taxed at 14% to be reduced to 5%

 

Sweet Supari

To be reduced from 14% to 5%

 

Chapattis

Presently taxed at 14% to be exempted

 

Bulk Chemical products like Caustic Soda

To be reduced to 2%

Medicines

It is suggested to amend Rule 3(3)(a)providing to revert back for payment of tax as per KVAT

 

Plastic Domestic mats

To be reduced from 14% to 5 %

 

Timber

To be reduced from 14% to 5 %

 

 

 

 

ACKNOWLEDGEMENT

 

FKCCI acknowledges the continued support of Government of Karnataka, Commercial Taxes Department, Revenue Department, Motor Vehicle Department and other concerned Tax Departments and assures full co-operation for the development of economic activities of Karnataka.

 

-------------

 



 

.

 

.

 

 

 

Classifieds

The Retail Times

The Retail Times The Retail Times The Retail Times showcase the dynamics of the retail industry

Weather

Mostly cloudy

27°C

Bangalore

Mostly cloudy
Humidity: 84%
Wind: ESE at 12.87 km/h
Saturday
PM Thunderstorms
21°C / 30°C
Sunday
Thunderstorms
19°C / 27°C
Monday
PM showers
19°C / 28°C
Tuesday
AM Clouds/PM Sun
19°C / 27°C

GIM - 2012

gimgimgimgimgimgimgimgimgimgimgimgim

Exclusive on SME Times

Bangalore, Karnataka, India, Thursd

New Delhi, Delhi, India, Wednesday,

Mumbai, Maharashtra, India, Wednesd

Daily Updates

You are here:   HomeManagementPress ReleaseKarnataka State Pre – Budget Memorandum 2012-13
  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
Prev Next
South India Power Directory Year Book 014
Retail Times E-Magazine
Kirloskar GREEN
Ansals
Civitech
DLF
Habitat
IBLS
Inkfruit
ISRMAX
Nikon
Oberoi
Omaxe
Prestige
SME
Strip Wire
Terrasaas