Bhubaneswar, Oct. 6: The state government today extended the value added tax (VAT) concession from 5 per cent to 1 per cent on pulses for another three months.

"It has been decided to extend the time limit for reduced VAT on pulses for a further period of three months from October 1 to December 31 in order to enable the commissioner of commercial taxes to make an assessment of the impact of the tax reduction," said chief secretary Aditya Prasad Padhi after the cabinet meeting this evening.

On June 30, the VAT rate was reduced from 5 per cent to 1 per cent on pulses of all kinds for three months with effect from July 1 keeping in view the "general hardship of the common man to afford purchase of this essential item and the demand from the trade and industry".

After expiry of the three-month time period, the finance minister chaired a meeting yesterday.

"As the information regarding collection of tax on pulses and dals could not be made available... the commissioner of commercial taxes was unable to make an assessment of the impact of tax reduction," said Padhi.

Development commissioner R. Balakrishnan, who was earlier in charge of the finance department, said though the detailed data could not be made available, the trends indicated that the volume of dal business had doubled after the VAT reduction.

The cabinet has also approved the proposal for reduction of VAT from 14.5 per cent to 5 per cent for local manufacturers of LPG cylinders and also on the sale of e-rickshaw and e-bike. The other important decisions included execution of a water supply project at an estimated cost of Rs 432 crore for Berhampur city, five rural pipe water supply projects worth Rs 327 crore to provide safe drinking water in Balasore, Bhadrak, Puri, Keonjhar and Balangir districts.