Army personnel will get exemption from Value Added Tax (VAT) on purchase of two-wheelers and light motor vehicles from CSD canteens in the state, official sources said here today.
"A notification to give exemption to Army personnel on purchase of vehicles was issued by the Tax and Registration department yesterday," they said.
As per the notification, exemption in VAT would be limited to sale of 3,000 motorcycles, scooters and mopeds and 1,200 four-wheelers every year, they said adding that serving personnel of Indian Army, other security establishments and ex-servicemen will get the benefit of tax exemption.
This tax exemption will, however, result in Rs7.29 crore annual revenue loss to the state government, official sources said.
The notification also stated that Army personnel willing to avail tax exemption will be required to get an authority letter from the commanding officer.
Besides, an officer will not be allowed to transfer a vehicle to any person other than the spouse, ward, serving or another retired armyman, for a period of 10 years.
This condition will be mentioned on the registration certificate of the vehicle.
At present 12.5% VAT and 1% additional tax is being charged on vehicles.
