Jayalalithaa

Chennai, Feb. 11: The Jayalalithaa government today abolished agricultural income-tax for plantation crops and announced big across-the-board reductions in stamp duty rates.

The measures are in keeping with the slew of sops announced yesterday with an eye on the coming Lok Sabha elections.

Presenting a tax-free budget for 2004-05, finance minister C. Ponnaiyan said income-tax on the plantation industry would be abolished from April 1. Tea, coffee and rubber industries have in recent years been incurring losses due to falling prices and increasing production costs, he said.

The minister unveiled the concessions during a presentation that lasted more than two hours and was attended by chief minister Jayalalithaa.

Agricultural income-tax from plantations, which contributed nearly Rs 40 crore to the state exchequer in 1997-98, crashed to Rs 1.60 crore in 2002-03; it fetched only Rs 1.35 crore this year.

But the tax was being abolished since the tax collection expenditure, at Rs 1.60 crore, exceeded the revenue. The move would also help revive the plantation industry and give tea growers better prices, Ponnaiyan said.

The minister announced reductions in stamp duty, based on the recommendations of the Dr Raja J. Chelliah Commission on Tax Reforms and Revenue Augmentation. He said the duty reduction to 8 per cent for “conveyance of properties”, which had already come into effect, had increased revenue.

The government was now reducing stamp duty on other instruments, including property transactions within the family. The settlement, release, partition and dissolution of partnership instruments will now be subjected to a uniform stamp duty rate of just 1 per cent of the market value of the property, subject to a ceiling of Rs 10,000.

Stamp duty rates for mortgage deeds, deposit of title deeds, lease agreements and power of attorney documents have also been slashed, Ponnaiyan said.

The minister said the final deficit for 2004-05 has been pegged lower at Rs 590.47 crore. He also announced sales tax exemption for 10 life-saving drugs used to treat AIDS patients.

Ponnaiyan said the tax sops would cost the government Rs 140 crore.

A National Institute of Science, on the lines of the Indian Institute of Science in Bangalore, will be set up in Chennai in the coming year to foster research in the basic sciences. It will be a joint initiative of Madras University and Anna University.

Jayalalithaa described the budget as “people-oriented. We hope we can make better revenue realisation”, she added.

The entire Opposition, barring the BJP and the All India Forward Bloc, boycotted proceedings, protesting against the government’s refusal to allow a discussion on the budget.

A new alliance dubbed the People’s Front and comprising two major Dalit parties and a Yadav-outfit was formed today. The K. Krishnasamy-led Puthiya Tamizhagam and the Dalit Panthers of India headed by T. Thirumavalavan joined hands with the Makkal Tamil Desam that represents the backward Yadavs.