Tamil Nadu budget proposes introduction of VAT

Laced with sops for farmers, traders, weavers and government employees, the maiden budget of the DMK government today proposed to introduce Value Added Tax (VAT) system in Tamil Nadu from next year.

Chennai, July 22: Laced with sops for farmers, traders, weavers and government employees, the maiden budget of the DMK government today proposed to introduce Value Added Tax (VAT) system in Tamil Nadu from next year.
With the introduction of VAT from January 1, 2007, the releases tax in the state would be abolished, state Finance Minister K Anbazhagan said while presenting the

The announcement on implementation of VAT fulfils one of the long-pending demand of industrialists in the state.

Among the schemes announced were a two per cent cut in the interest rate for farmers` co-operative loans and revival the agricultural labourers welfare board, set up in 2000 but
merged with labour welfare board by the AIADMK government.

The government would set up a third Police Commission to redress the grievances of policemen and strengthen the police force in the state.

Besides assuring its employees that it would consider implementation of the sixth pay commission recommendations at an "appropriate time", the government restored bonus benefits, which were withdrawn during the AIADMK rule in 2001.

An administrative reforms commission would be set up to "remove red-tapism" from government offices, the minister added.

Anbazhagan said a new industrial policy would be announced this year, which would encourage and strengthen leading sectors like leather, textile, automobile and
electronic hardware.

A special task force, headed by Chief Minister M Karunanidhi and with representatives of the industry and commerce, would be constituted to resolve the problems facing
the industrial sector, he said.

Special concessions would be offered to computer
manufacturing firms which have evinced interest in setting up
their units in the state, he said and announced sales tax
exemption for computers manufactured by those with an
investment exceeding Rs100 crore in the special economic zones
in the state.

A second tidel park in the city would be set up to attract more it companies and a joint venture software park would be developed by the state and software technology parks
of India at Coimbatore, he said.

Infosys has committed an investment of Rs 1,250 crore to build a 50 lakh sq feet office space for software development, which would give employment to 25,000 people, he said.

In a bid to encourage Tamil software industry, licensed Tamil software would be exempted from sales tax, he said.

He also announced free power upto 100 units for two months to handloom weavers owning their own worksheds and upto 500 units for powerloom owners.

Discussion on TN budget from July 24

The general discussion on the Tamil Nadu budget will commence from July 24, the Assembly Speaker R Avudaippan said today.

Speaking to reporters here, he said the discussion would conclude on July 31, with the reply of Finance Minister K Anbazhagan. The decision was taken at the business advisory committee meeting held today, he said.

The discussion on demands for grants would begin from August 1 with the Department of Non-conventional Energy and small scale industry. It would be followed by that of the
co-operative and food department on August 2, agriculture on August 3 and education on August 4, he said.

The assembly schedule from August 5 would be decided at the business committee meeting to be held on August 1, he said

The Speaker said the AIADMK had withdrawn its plea to extend the chamber of opposition leader to the adjacent room. The party had included the name of its Treasurer D Jayakumar as its representative in the business advisory committee instead of its deputy leader in the assembly, O Panneerselvam, he said.

Bureau Report

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