The Rajasthan government on Tuesday presented Budget for 2010—11, which imposed a cess of 10 paise on consumption of one unit of power in urban areas and raised the VAT rate from four per cent to five per cent

The Budget also cut one-time tax on 100cc two-wheelers from five per cent to four per cent but raised the tax on above 100 cc vehicles to 8 per cent.

Rationalising the one-time tax structure on four-wheelers Chief Minister Ashok Gehlot, who also holds the finance portfolio, reduced the tax slabs to four from six, with tax rate of 2.5 per cent tax on cars of up to Rs. 2.5 lakh and 10 per cent on cars costing above Rs. 10 lakh.

He also proposed compulsory registration of mobile towers and levy of annual user charges on the service providers.

Mr. Ghelot said it was mandatory on the part of the state government to hike the lower tax rate of value added tax (VAT) from four per cent to five per cent.

He said the revenue collected from cess of 10 paise per unit on consumers in municipal areas consuming over 100 units per month will be used for street lighting, sanitation, sewerage and energy conservation in urban areas.

The cess would come into effect from April.

The Budget presented an annual plan size of Rs. 23,822 crore with a fiscal deficit of Rs. 8,461.00 crore. The revenue deficit is estimated to be around Rs. 1,098 crore.