Published On : Wed, Mar 18th, 2015

Traders delighted over scrapping of LBT

Nagpur.

The decision to scrap Local Body Tax (LBT) in Maharashtra as announced by Finance Minister Sudhir Mungantiwar while presenting the State Budget for 2015-16 was welcomed by traders and business community.

Devendra ParekhVED:
The President of Vidarbha Economic Development Council (VED) Devendra Parekh said, “Traders are delighted. Now, the traders will do business at ease. Paying taxes is one thing but paying taxes at different departments is other thing. The laws are penalizing. They make the traders to comply with each and every formality. LBT was penalizing. Traders have got riddance for the tax. Now, LBT has been merged with VAT. We will not mind paying more VAT as it will be paid at one go and at one place. VED welcomes the decision to scrap LBT as it also showed that the BJP Government sensitive to the welfare of all the people,” said Parekh.

Populist Budget: Dipen AgrawalDipenagrawal
The Immediate Past President of Nag-Vidarbha Chamber of Commerce (NVCC) Dipen Agrawal said the first budget presented by Devendra Fadanvis -led Government was presented in the midst of financial crunch with a debt burden of almost 3 lakh crores, has something for each sector i.e. agriculture, industry, infrastructure, education, health, urban, rural, poor etc.  with no increase in any tax rates is welcome.

Government has failed to honour their commitment of abolition of  LBT from 1st April 2015 but in this budget gave conformation for  abolition of LBT and Octroi from 1st August 2015 and compensation of revenue by enhancing tax rate of VAT is welcome subject to the state government honouring their commitment made through the budget this time.

Levy of 5% Entry Tax on long steel products is welcome because it shall insulate secondary steel producers incurring high input costs and facing competition for sales visa-vis imports from adjoining states.

A lot was expected but could not be delivered.  “Make in Maharashtra” slogan may just be on paper nothing promising to promote this slogan in the budget.

Overall the budget appeared to be a ‘Statement’ rather than a ‘Budget’.

NVCC President Mayur Panchmatiya said, “We were expecting total abolishment from 1st April, 2015. An account based system, full of complexity, bulky record is inconvenient for the traders. We hoped that tax will be replaced by an alternate tax & Government shall withdraw LBT in to-to. The 26 Municipal Corporations affected by LBT are disappointed. Justice was delayed but not denied.

FAM, a parent body of traders, has called an urgent meeting to discuss Maharashtra Government Budget proposals and its impact on the business community.  Other announcement of budget proposals like 5% Entry Tax on long steel products will give boost to industry sector of Maharashtra. They will survive, and sell their products in competitive rates. The benefits provided to agriculture sector, an incentive shall be a boon for farmers. The State economy shall prosper by State budget

Prominent present were Past Presidents Prafullbhai Doshi, Nilesh Suchak, Vice President Ajay Madan, Secretary Manubhai Soni, Treasurer Raju Vyas, Jt. Secretaries Sachin Puniyani, Arjundas Ahuja & others, said a press note issued by NVCC.

BC Bhartiya B C Bhartia:
“The first Budget of Chief Minister Devendra Fadnavi’s  Govt is a deviation from traditional bureaucrat  made budget to grassroot level worker, thinker and political leaders having approach focused at rural people,” said B C Bhartia, National President of Confederation of All India Traders.  Reacting to state budget,  B C Bhartia further said the budget is focused towards overall development of agriculture and agriculturist. State Govt  intention and policy are in line to address issues of all the sections of society. It is well balanced and inclusive budget which drives the state economy through rural development.

The amendments in VAT law regarding  revision in returns is a welcome step. However it is unfortunate that the state govt. has taken a total U-turn on abolition of LBT. There are number of pending matters under Bombay Sales Tax Act it was expected that some amnesty scheme to settled old issues may be announced but it was a total disappointment on this issue.  With this budget it appears that Maharashtra State is poised for becoming leading state of country.

Mathuraprasad Goyal and  Shankarlal Jalan, welcoming the provision of budget, said that amendments in VAT laws was much aviated .  The clarification about particle   board and plywood was much needed relief.  The budget is progressive.

Kishor Dharasivkar, President Team CAIT Nagpur, said that relief of private loans to farmers is a welcome step but the major problem is loans taken by farmers from unauthorised money lenders. This issue has not been clarified.

Farooque Akbani, President of Vidarbha Rural Industries Assn said that the development of rural roads will help in improving economic status of rural people. Review of old Acts, notifications etc. will help in getting relief from out dated laws.

Prabhakar Deshmukh, President of Nagpur Chillar Kirana Vyapari Sangh said that the policies   announced if implemented in letter and spirit will boost our rural economy.

Nikhilesh Thakar said that reduction in penalty  on late  filing of return Rs. 2000/- to 1000/- is a welcome step.  Finance Minister in the Budget has given clarification on some issues under VAT.  However clarification on many other issues is left out.

Vatsal Bhartia  said that the provision of cyber  labs  in each district will help in detecting cyber crimes.

Ravindra Gupta said that special focus has been given for development of adivasi and Naxalite areas.  Promoting forest tourism will also help in improving economic state of adviasi people.

Chhaya Sharma said that increasing professional tax exemption limit for women to Rs. 10000/- is a welcome step.

Moreshwar Kakde said that the promotion of bamboo based industry  and  modernization of bus stand is a welcome step. Giving  Rs. 50000/-  to rural people for buying residential house is also a welcome  step.

Ramavtar Agrawal welcoming the state budget said that it is a historic budget well balanced between rural and urban Maharashtra.

jotwaniSandeep Jotwani, Chartered Accountant:
Secretary of Nagpur Branch of Institute of Chartered Accountants of India Sandeep Jotwani in his reaction said, “For Nagpurians, this Budget has many things to make them feel “Acche Din Aa Gaye”. Local Tax abolition, Rs 125 crore for renovation of bus stand, Rs 197 crore for Metro Rail project will definitely make the Nagpurians feel happy and special.  Late filing fees on VAT returns was very harsh and there was immediate need to reduce it which is done and is a welcome step. There is a long time demand for amnesty scheme for professional tax which was not done this time and is expected in future along with amnesty scheme for LBT. Sufficient amount is allocated for education, infrastructure, Energy as well as tourism which makes this budget a good budget,” said Jotwani.

Ashwini Agrawal, Chartered Accountant:Ashwini Agrawal
The Immediate Past Chairman of Nagpur Branch of WIRC of ICAI Ashwini Agrawal said, “After lot of opposition and struggle by trade and industry, finally Finance Minister has announced abolition of LBT wef 1st August, 2015. However revenue loss due to this of Rs 6875 crore  will be compensated by enhancing rate of tax under Value Added Tax Act, which will be applicable to the whole State, which is again going to create various issues and anomalies. The modus operandi of the same has not yet been announced and will be of concern for the trade and industry. To avoid cascading of tax, clarity on not charging of service Tax on VAT amount in case of supply of services in composite works is much needed and long awaited relief and welcome move. Now, in VAT dealer can file multiple revised returns enabling him to ascertain his tax liability properly before assessment,” said Agrawal.

Agrawal further said, “Presently the State bears a debt burden of over Rs 3 lakh crore by servicing an interest burden of over Rs 24000 crore with revenue deficit of Rs.13883 crore. Additional revenue is proposed to be generated by charging premium fee linked to the market value of land for change in purpose of the land, additional F.S.I. which is going to hit the realty market hard. For industrial development of state an innovative project ‘Make in Maharashtra’ to be launched, however details for the same have not been specified now. Provision of Rs. 197 Crore for Nagpur Metro Rail Project and setting up of National Pharmaceutical Science Education and Training Institute at Nagpur is welcome step. Similarly provision of Rs. 200 Crore for MIHAN, with recently established empowered Committee under the Chairmanship of Hon. Nitin Gadkari will definitely help the project to see the light of the day. Since ages textiles was the strength of Vidarbha and in this budget after a long time the eligible textile projects from Vidarbha, Marathwada & North Maharashtra are allowed to get 10% capital incentive which is very good move to help development of this region,” said Agrawal reacting to the Budget.