Free Press Journal

LBT abolished for most traders in Maharashtra

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LBT

Mumbai: Starting today, the Local Body Tax (LBT) has been abolished for most traders in 25 of the municipal corporations in Maharashtra, including those of Thane, Pune and Kalyan-Dombivali. With this the ruling BJP has fulfilled one of its poll promises, that was instrumental in bringing it to power in the state.

LBT will now be inapplicable for traders earning less than Rs 50 crore annually, who account for 99.85 per cent of all traders in the state. While the Congress and the NCP could not manage to reach a consensus in its tenure, the BJP-led government in the state has managed to fulfil its election agenda by allowing the proceeds from the collection of stamp duty from cities to be paid to their respective municipal corporations.

According to Chief Minister Devendra Fadnavis, the government’s decision will benefit 8,08,391 traders out of total 8,09,553 registered traders. State Finance Minister Sudhir Mungantiwar said that in lieu of the exemption from LBT, the government will impose a surcharge on Value Added Tax (VAT) till the Good and Service Tax (GST) gets implemented from April 1, 2016. He added that octroi will continue in the jurisdiction of the Municipal Corporation of Greater Mumbai (MCGM) until GST gets implemented.


Fadnavis said that in lieu of LBT, the government has to pay Rs 4,210 crore for a period of seven months from August 2015 to March 2016 as grants. However, the government by way of supplementary demands for 2015-16 has allocated Rs 2,048.44 crore as an immediate measure for financial grants to the municipal corporations.

Besides this, the government has granted extension to the amnesty scheme till August 15 and will cover months of April to July in the financial year 2015-16. At present there are 8.09 lakh registered traders in these 25 municipal corporations, out of which 8.08 lakh traders have been exempted from the purview of LBT.