Giving its nod to the revenue-boosting measures proposed in the March-18 budget, the state cabinet on Friday cleared various tax proposals expected to generate around 150 crore as additional revenue. It also approved several amendments, including those seeking to refund VAT to foreigners and VAT on aviation turbine fuel.
Speaking to TOI after the cabinet meeting on Friday, chief minister Manohar Parrikar said the government will now formulate a scheme to refund VAT to foreigners at the airport on goods they have purchased in the state. The offer will be extended to desi tourists as well, but at a later date.
"We want to start this scheme in October or November. As it is a first time (move), let me try it first on foreigners, and once we are experienced we will implement it for Indian tourists," said Parrikar. He added that while the scheme will be implemented at the airport, the sales tax commissioner has been empowered to formulate a scheme that can include other exits points.
He stressed that under the scheme foreign tourists would have to carry the goods with them at the time of leaving the state and VAT would not be refunded on small purchases. While the move would be a loss to the state exchequer, he said it would boost local trade.
"The idea here is can we make Goa a high-value shopping destination? I think I can," said Parrikar, adding, "(In) the same way we want more seats to be booked for Goa by airlines, that is the reason ATF VAT refund scheme will be introduced."
The cabinet has also decided to impose a minimum fine of 1,000 on shops not issuing bills to customers. "If the shopkeeper is found not issuing bills 10 times in a year then his registration will be cancelled," said Parrikar.
The cabinet has also approved the increase to 5% from 2% in tax deducted at source (TDS) for contracted works. Parrikar said this is because most contractors buy material without bills and many buy from neighbouring states. "This (hiked TDS) will increase the government's revenue by 30 crore,"he said.
The cabinet has also given its nod to an entry tax on unregistered dealers, transporters and couriers. This is aimed at online purchases which will now bear the tax as well.
The cabinet also cleared the proposal of an entertainment tax and establishments falling under the category will have to take pre stamped tickets from the government for tickets such as casino entry tickets etc.
The amendment to VAT for implementation of tax on apartments was also approved, ensuring that anyone buying a flat above 10 lakh will have to pay VAT during the sale agreement.
Amendment to the Goa tax on infrastructure was also approved and will generate an additional revenue of around 70 crore. Five more categories have been brought under this tax, including agriculture and allied, agro-based infrastructure buildings, industrial buildings, recreational and entertainment structures.