Vidhan Sabha passes bill to increase stamp duty on merger of companies in HP

The government will decide the rate of sand and gravel in Himachal Pradesh and will charge stamp duty at the rate of 8% on mergers of companies or separation of partners of companies

To raise resources, the Himachal Pradesh government has decided to increase the stamp duty on the merger of companies and mining leases.

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The government will decide the rate of sand and gravel in Himachal Pradesh and will charge stamp duty at the rate of 8% on mergers of companies or separation of partners of companies. Government will also charge a 6% stamp duty on the lease amount on the auction of mining leases.

Revenue minister Jagat Singh Negi introduced an Amendment Bill in the House on Friday and the bill was passed on the last day of the winter session, by voice note, after discussion.

While bringing the bill, Negi stated that when two industrial companies merge, the government does not get anything in return. No stamp duty is levied on them which causes loss to the government. So, government is making a provision to impose an 8% stamp on these companies so that resources can be raised for the government. He said the earlier 5% stamp was imposed on mining leases, which is being increased by 1% and it is under the jurisdiction of the state government.

Earlier this bill was discussed in the House and the opposition raised some objections to it. MLA Randhir Sharma said when the government stamps the mining lease, it will directly impact the prices of the sand and gravel.

Leader of Opposition Jairam Thakur said on the one hand, government is working to attract industrialists from Dubai and on the other hand it is imposing such conditions for them here.

“Why would industrialists come to Himachal, when even electricity here is being provided more expensive than in other states? What kind of magic wand does the CM have by which he is guaranteeing to make Himachal resourceful in four years? By imposing taxes in this way, the general public is being burdened,” he said.

BJP MLA Bikram Singh said the increase in stamp duty will prove detrimental for investment. He said that the government does not have the power to put such stamps etc. because the issue of mining comes under the Central Act.

MLA Trilok Jamwal also said that if a sick unit merges, the government provides facilities to that unit before that. In such a situation, who will pay the stamp duty during the merger? On this, Jagat Singh Negi said the sick unit is always merged with a competent company and that the company can pay stamp duty. After discussion, this bill was passed in the House with the majority of the ruling party.