VAT on tobacco products proposed for hike from 12 to 20%

GANGTOK, 26 June: The State government has proposed to increase Value Added Tax on the sale of tobacco products from 12 percent to 20 percent from the current financial year. In this regard, Chief Minister Pawan Chamling tabled the Sikkim Value Added Tax (Amendment) Bill 2012 in the Sikkim Legislative Assembly during its budget session for the financial year 2012-13. 
While tabling the amendment bill on the floor of the house, the state government in its statement of objects and reasons, explains that a new Schedule in the Sikkim Value Added Tax Act 2001 will be introduced in order to increase the VAT rates levied on sale of tobacco and all its products including cigarettes and chewing tobacco, other than ‘beedis’ and raw tobacco leaves.
The Chief Minister further said that the measure seeks to reduce health problems caused due to tobacco consumption and to discourage such practice in the vulnerable section of the population such as the poor, children and youth. The voting and discussion on the bill will be taken up on 28 June.