Professional tax relief to traders, senior citizens

With states having no option to tinker with the GST, Chief Minister Siddaramaiah has in his budget provided relief to lakhs of small traders by enhancing the turnover limit for levying professional tax.

Siddaramaiah has also expanded the base for professional tax exemption to senior citizens in the poll-bound state.

During the previous VAT regime, Siddaramaiah in his budget proposals announced sops to consumers by slashing tax on commodities. However, GST regime does not provide that option. He has now increased the turnover limit for levy of professional tax on traders from Rs 10 lakh to Rs 20 lakh a year. Traders whose turnover is less than Rs 20 lakh need not pay professional tax.

Siddaramaiah had proposed to amend the Karnataka Tax on Professions, Trades, Calling and Employment Act, 1976, to effect the change. In another move, he has proposed to amend the same Act to extend the provision of exemption for senior citizens in different sectors.

At present, this exemption is provided to traders and Siddaramaiah proposes to extend the same to senior citizens working in companies, firms, corporations, societies and clubs, sources said. Siddaramaiah has not touched sales tax on diesel and petrol, but has claimed credit for passing on reduction in fuel prices (Rs 3.1 litre on petrol and Rs 2.68 per litre on diesel), following the abolition of entry tax from July 1 last year.

He has proposed to reduce sales tax rate on aviation turbine fuel for small aircraft from 28 to 5% as agreed with the Central government to support UDAN.