Finance minister Amit Mitra may increase value-added tax on tobacco products, luxury cars and branded garments when he makes a statement in the Assembly tomorrow on the states finances.

According to finance department officials, VAT on some items included in the Schedule C, which covers articles taxed at 4 per cent, may be increased to 5 per cent. These include cigarettes.

The government is, however, unlikely to tax bidi as it is smoked mainly by the poor. But the government may increase VAT on branded garments and expensive shoes by bringing them out of Schedule C and putting them into the 13.5 per cent tax slab (Schedule CA), the officials said.

According to them, some states have already increased the tax on Schedule C items, which include industrial and IT inputs.

The officials said luxury cars might be put under the 30 per cent tax slab, which has no items under it so far.

Mitra refused to give a direct answer when asked if he would introduce the tax proposals in the Assembly tomorrow or include them in the finance bill, scheduled to be placed on August 29. I have nothing new to say tomorrow except clarifying some points mentioned in the annual financial statement issued on June 14.

A separate bill needs to be introduced for tax proposals. It is yet to be decided, the finance minister said this evening after a cabinet meeting.

Legislative affairs and industries minister Partha Chatterjee, however, indicated that the finance bill was likely to contain the tax proposals. The Left governments had done so in 1977 and 2006, both Assembly election years.

The three-month vote-on-account introduced on June 14 did not include tax proposals because of the Centre-state negotiations on a financial package. As the package has now been announced, the Centre wants the Mamata Banerjee government to levy fresh taxes or increase existing ones to generate the states own resources.

Earlier in the day, Mitra briefed Trinamul MLAs on budget provisions and its procedural aspects to prepare the Treasury Bench members for tomorrows House session. Chatterjee spoke to the party MLAs about the dos and donts at the session.

The CPMs Surjya Kanta Mishra, the leader of the Opposition in the Assembly, also held a meeting with Left Front MLAs at Alimuddin Street. With our much-reduced numbers in the House, all Left MLAs have been asked to attend Assembly proceedings regularly and visit the House library to fine-tune their arguments, a senior front MLA said.