Vat effect: Punjabis shifting marriage venues to Haryana
October, 23rd 2013
After the Punjabis living in districts bordering Haryana buying petrol from the neighbouring state at cheaper prices has become common, the huge value added tax (VAT) being levied on marriage palaces has forced people to shift even marriage venues to Haryana.
According to a recent decision of the Punjab government, the VAT on bigger marriage palaces will be from Rs. 60,000 to Rs. 2 lakh, whereas Haryana charges its marriage palaces only Rs. 10,000. The fee for a permit for serving liquor is Rs. 1,000 in Chandigarh and Rs. 1,500 in Haryana.
"I have cancelled my booking at Patiala following the huge tax and shifted the venue to Ambala for the marriage of my daugher, as both places are equidistant from my place. Why should I pay Rs. 84,000 as tax besides a rental of Rs. 1 lakh and Rs. 30,000 as decoration charges, when in Haryana I can get a marriage palace, including taxes, for only Rs. 80,000," said Rachpal Singh, a resident of Rajpura. He said that besides liquor was also cheaper in Chandigarh and Haryana.
Punjab Marriage Palace Owners Association office-bearer Satish Sethi said, "Some consumers have already cancelled bookings, while many are contemplating making bookings in Chandigarh and Haryana. Why would consumers pay a minimum of Rs. 60,000 as VAT when they can get a venue without any tax at a distance of 50 km? The new inquiries have almost come to a standstill as people have started moving to Chandigarh and Ambala for smaller functions. Like petrol pumps, marriage palaces in the districts bordering Haryana and Rajasthan will be the worst sufferers."
The other reason is the illegal raids by the liquor mafia, which barge into marriage functions and check the liquor bill to ascertain whether the liquor was purchased from their vend or not. "It's highhandedness, mafia is ruling here. Many a time, I have seen the mafia spoiling marriage functions," said caterer RK Sharma. He said the union had decided to pass on the taxes to the consumer.
The petrol pumps of the districts bordering Haryana are already affected as petrol is cheaper in Haryana by almost Rs. 7. Also, farmers preferred selling their wheat and paddy in Haryana, as there was a lower VAT on purchase, and thus commission agents there paid farmers more.
Taxes in Punjab Minimum VAT Small marriage palaces: Rs. 40,000 Big marriage palaces: Rs. 60,000
Luxury tax Small marriage palaces: Rs. 8,000 Big marriage palaces: Rs. 16,000 or 15% VAT and 12.4% luxury tax on total bill of marriage palace
Fee for permit to serve liquor Small marriage palace: Rs. 5,000 Big marriage palace: Rs. 10,000 Haryana: Rs. 1,500