Hyderabad: Ear-bud sticks, lollypop sticks, drinking straws, school uniforms, school belt and ties have been added to the list of items that will attract value added tax.
To add to the government’s revenue and commercial taxes department officials are on the job to find more items that can be added to the VAT list. The imposition of VAT increases the price of these items.
The government has set itself a target to collect Rs 42,073 crore through VAT, up 29 per cent over 2015-16. It has issued a circular to all schools to pay VAT on sale of uniforms, belts and ties. It has imposed higher VAT of 14.5 per cent on school belts while imposing just 5 per cent VAT on machine belts.
Traders have approached the department seeking a clarification on why 14.5 per cent VAT has been imposed on belts while it is 5 per cent in the case of ties.
The department said that while ties come under readymade garments, belts are not. It clarified that since belts were not listed under the VAT Act till now, it would attract 14.5%.