VAT hike will not affect common man: Dikshit

Last Updated: Sunday, December 27, 2009 - 14:25

New Delhi: In a bid to address the concerns
arising out of her recent announcement on steep hike in the
value-added tax on several items, Delhi Chief Minister Sheila
Dikshit has said that it will affect only those going for
luxury goods and not the common man.

Dikshit said VAT on luxury items including high-end
cellphones, watches and pens will be increased substantially
in March when the budget for Delhi for 2010-11 fiscal will be
presented, a move triggered by fund shortage due to huge
spending on infrastructure projects for Commonwealth Games.

"I do not know what all mobiles are there above 20 lakh,
or 15 lakh or 10 lakh. I would not like to touch the person
who buys them for Rs 2,000 or Rs 4,000. I do not want to touch
a person who buys a Rs 500 or Rs 1,000 or 2,000 rupees watch.

"I would not like to touch a person who buys an ordinary
pen. If he buys expensive pen worth Rs 10 lakh, Rs 5 lakh then
I think those people can afford to give little more," the
Chief Minister told a news agency in an interview.

Asked if her move will not prompt businessmen to move to
next door states, she said the Government will take
appropriate measures to see that businesses do not shift to
from Delhi to neighbouring places.

"Yes, that is a definitely a challenge (but) I would say
would you go and buy a Mont blanc pen in Gurgaon or in
Faridabad when you know it is available here," Dikshit said,
adding that there is a category of consumers who are so rich
that they don`t care about money but about the place they are
seen shopping at.

The Government last week has increased VAT from four per
cent to five per cent on 120 items, including food which will
help them to mop additional resources to the tune of Rs 500
crore.

Asked about the other items which will have increased
VAT, she said her government was still going through the
process of firming up the list.

"Look when we come to the budgets in March, thats when I
will really go through it very thoroughly," she said.

PTI



First Published: Sunday, December 27, 2009 - 14:25

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