Chennai: New taxation proposals to fetch a revenue of Rs 430 crore had been proposed in the Tamil Nadu Budget for 2003-04, presented to the state Assembly on March 21, leaving an uncovered deficit of Rs 865.15 crore.

Additional support from the Central government for the annual plan, economic restructuring and implementation of measures for fiscal consolidation would help tackle the remaining deficit, Finance Minister C Ponnaiyan said while presenting the Budget.

In moving towards the Value Added Tax (VAT) system and doing away with additional sales tax and surcharge, the Budget envisaged an increase in existing tax rate of petrol from 29.4 per cent to 30, a marginal increase of two to three per cent for high speed diesel and light diesel oil, taking the tax to 25 per cent, and hiking the tax for white kerosene from the existing four per cent to 25. The tax rate for PDS (public distribution system) kerosene would continue to remain at 4 per cent.

It had also been decided to levy a tax of 12.5 per cent on telephone rentals collected by Bharat Sanchar Nigam Ltd (BSNL) and other private operators including the rentals on mobile telephones. The above measures, coming into effect from March 21, would yield an additional Rs 200 crore to the government, Ponnnaiyan said.

Entry tax of 12.5 per cent on washing machines and four per cent entry tax on low- density polyethylene and polypropylene in all forms would be levied. The luxury tax on jewellery stocks would go up from the existing one per cent to three. There will now be a compulsory compounding system of taxation for cable TV operators in place of the existing tax on cable connections, he said.

PTI