Finding no benefit accruing to the customers pertaining to reduction of VAT rates on mobile handsets costing upto `3,000, the State Government has reversed VAT rates to 14 per cent from 5 per cent announced earlier.
The decision effective from June 1 this year has been taken following the information received by the Government that the earlier exemption on VAT offered to the mobile handset dealers was not benefitting the customers.
A notification to this effect had been issued by the Commercial Tax Department on Sunday.
It may be mentioned that the Chief Minister Raman Singh in his budget speech for Financial Year 2013-14 had announced the reduction of VAT on mobile phone handsets costing upto Rs 3,000 from 14 per cent to 5 per cent .
Following the announcement by the Chief Minister, the same was implemented by the Commercial Tax Department on April 1, 2013.
The Commercial Tax Department , after the reduction on VAT on the said mobile handsets carried out a review in which it was found that customers were not getting benefitted despite reduction announced in the rates.
Despite this, the mobile phone manufacturers went ahead with a rise in price of mobile handsets sold by their authorised dealers.
Following this, the Government reintroduced 14 per cent VAT on the mobile handsets.