Local body tax not to affect small retailers and consumers, says Maharashtra CM
Updated: May 14, 2013 02:51:03pm
Mumbai, May 14, (KNN) The imposition of local body tax (LBT) will not affect small retailers as its levy is meant only for those who import goods into city, assured Maharashtra Chief Minister, Prithviraj Chavan.
“LBT is to be paid only by those who import goods into the city for consumption, use or sale. These include wholesalers and large size traders and not small retailers who purchase their merchandise locally,” he said in an interview with Business Standard.
The Chief Minister’s comments come in the wake of traders’ agitation against implementation of LBT that has affected consumers across the state.
He also referred to the recent government initiative to raise minimum limited for LBT registration from Rs one lakh to Rs three lakh, stating, “LBT will not put any additional tax burden on the citizens, who are already paying octroi on the goods that they purchase,” he said.
The government has also given the option of making lump-sum payment of LBT at two per cent to traders having annual imports up to Rs 10 lakh.
Calling octroi regressive and corruption prone Chavan favours LBT which while having the same yield will protect the financial autonomy of the larger urban local bodies.
For municipal corporations other than Mumbai, the law for LBT was duly passed by the state legislature in December 2009. Over the last three years, LBT has been introduced in 24 civic bodies across the state.
LBT is yet to be imposed in Mumbai, for which the government has plans to bring legislative approval.
The LBT is an account based system having a trust on traders which will bring more transparency.
“Unlike octroi, LBT is account-based. If octroi uses the strong-arm method of stopping incoming goods at nakas for recovering the tax, LBT is a faith-based levy, wherein the government expects importers to maintain truthful accounts of their imports and pay their taxes accordingly, filing just two returns every year in the process. LBT is expected to promote transparency in financial transactions,” said Chavan.
He also allayed fears of traders that municipal officials may harass them in the form of mala fide searches, seizure and assessment.
Chavan brushed aside the demands of traders to increase one per cent in VAT instead of LBT.
Meanwhile, the government has recently set up a high-level committee under the chief secretary for interacting with all stake holders and recommending further improvements in the system of LBT. (KNN)
“LBT is to be paid only by those who import goods into the city for consumption, use or sale. These include wholesalers and large size traders and not small retailers who purchase their merchandise locally,” he said in an interview with Business Standard.
The Chief Minister’s comments come in the wake of traders’ agitation against implementation of LBT that has affected consumers across the state.
He also referred to the recent government initiative to raise minimum limited for LBT registration from Rs one lakh to Rs three lakh, stating, “LBT will not put any additional tax burden on the citizens, who are already paying octroi on the goods that they purchase,” he said.
The government has also given the option of making lump-sum payment of LBT at two per cent to traders having annual imports up to Rs 10 lakh.
Calling octroi regressive and corruption prone Chavan favours LBT which while having the same yield will protect the financial autonomy of the larger urban local bodies.
For municipal corporations other than Mumbai, the law for LBT was duly passed by the state legislature in December 2009. Over the last three years, LBT has been introduced in 24 civic bodies across the state.
LBT is yet to be imposed in Mumbai, for which the government has plans to bring legislative approval.
The LBT is an account based system having a trust on traders which will bring more transparency.
“Unlike octroi, LBT is account-based. If octroi uses the strong-arm method of stopping incoming goods at nakas for recovering the tax, LBT is a faith-based levy, wherein the government expects importers to maintain truthful accounts of their imports and pay their taxes accordingly, filing just two returns every year in the process. LBT is expected to promote transparency in financial transactions,” said Chavan.
He also allayed fears of traders that municipal officials may harass them in the form of mala fide searches, seizure and assessment.
Chavan brushed aside the demands of traders to increase one per cent in VAT instead of LBT.
Meanwhile, the government has recently set up a high-level committee under the chief secretary for interacting with all stake holders and recommending further improvements in the system of LBT. (KNN)
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