Tax concessions, only major sop for common man, to cost state Rs 962 cr
June, 06th 2014
Finance Minister Ajit Pawar has claimed that tax concessions in this year’s budget will cost the state Rs 962 crore. There is, however, no major relief for the common man, barring the decision to increase the minimum salary limit for charging of professional tax from Rs 5,000 to Rs 7,000.
In a move that is likely to antagonise a lot of health activists, the state has decided to exempt all inter-state sales of unbranded manufactured tobacco. The Maharashtra government has banned gutkha in the state and in its last year’s budget speech, Pawar had spoken about the need to limit the consumption of tobacco. The government had decided to tax unprocessed tobacco at 12.5 per cent in last year’s budget, citing health reasons. However, economic considerations seem to have won over social and health considerations in this budget.
“Non-levy of such tax by other states has resulted in drastic reduction of inter-state sales. The trade may shift to other states adversely affecting employment,” said Pawar. Meanwhile, it will be a tad cheaper for the state’s population to stay in hotels. The state has decided to raise the luxury tax exemption limit from Rs 750 to Rs 1,000. It has also decided to provide luxury tax benefit to hotels in B and C zones in the state, which were earlier eligible only to hotels in Zone A. The entire state has been divided into three zones. Mumbai, Navi Mumbai, Thane, Pune and Pimpri are to come under Zone A. All municipal corporations, excluding areas in Zone A, would be in Zone B, while the rest of the areas of the state would be in Zone C.
The state has decided to increase the turnover limit of VAT audit from Rs 60 lakh to Rs 1 crore. It will also give exemption to sugarcane purchase tax while the tax rate on cotton has been reduced from five to two per cent. The state has also decided to provide exemption to spare parts of aeroplanes.
It will put a cap on the stamp duty levied on instruments of title deeds or hypothecation. Earlier, it used to be 0.2 per cent of the total value of the deal. Now, for all deals over Rs 50 crore, the government will recover only Rs 10 lakh. Pawar has meanwhile stated that the tax proposals are likely to cost the state Rs 962 crore. “The tax proposals are expected to reduce revenue yield by Rs 962 crore. However, I propose to compensate this by taking measures for efficient tax collection,” he said. to help us personalise your reading experience.
Share on facebookShare on twitterShare on google_plusone_shareShare on redditShare on linkedinShare on pinterest_shareMore Sharing Services 0