The Puducherry government on wednesday decided to increase the rate of VAT on cigarattes from 12.5 to 20 percent in its budget of 2009-2010. The Puducherry Chief Minister Mr V Vaithilingam said that the VAT rate was increased to discourage the consumption of cigarettes. He also announced that food and drinks sold by the Indian Coffee Workers Cooperative Society Ltd here would be exempted from VAT.