Plan to buy home, car? You may have pay more in Maharashtra
Buying a home, car or even alcohol is likely to become dearer as the Maharashtra government plans to hike stamp duty, registration charges and various other fees, which are levied by the state, this year.
While the state finance department did not announce any hike in levies or charges in the budget tabled on Tuesday, the department’s medium-term policy shows that such a hike is possible this year.
State finance minister Sudhir Mungantiwar tabled a Rs20,292-crore revenue deficit budget —when expenditure outstrips revenues — in the legislature and the government is hoping it can reduce this deficit by increasing its revenue sources. However, a senior state finance official, who did not wish to be named, said the hike in taxes could be introduced after September or October. The state Assembly polls areexpected to be held in October, and it is likely that the government may avoid the hike until then.
The medium-term fiscal policy strategy statement for 2019-2020, tabled on Tuesday, stated that the government plans to “revise various taxes under the motor vehicle department, state excise duty, stamp duty, registration and present rates of fees/fines under various laws and rules related to all departments under non-tax revenue”.
The policy statement further stated that non-tax revenue – fees, charges for various facilities offered by the government — for this year is only 5.34% of the total revenue (generally, it should be at least 8%).
“It is necessary to put an emphasis on the growth of non-tax revenue. Accordingly, it is aimed to revise rates of existing fees and fines under all departments,” states the policy.
With the introduction of the Goods and Services Tax (GST), which has subsumed as many as 17 state and central taxes within it, the state government has limited room to increase its own tax revenue. For this fiscal, the state expects to reach a target of Rs2,10,824 crore from sources other than GST, such as stamp duty, state excise, taxes on vehicles, taxes on sale of alcohol, among others.
The state’s share of non-tax revenue from its own sources — like fees, fines and levies from all its departments — is estimated at Rs16,807 crore.
The state’s own tax and non-tax revenue targets for this fiscal, estimate a hike of Rs9,842 crore over 2018-19 and if they have to be met, the taxpayer is likely to face some of this bill.
“The ratio of our own state tax and non-tax revenues to the state gross domestic product ranks quite low when compared to other states. This is also because of the size of our state economy, but there is room for improvement. We need to improve our revenue resources if we need to increase our development spending and reduce the revenue and fiscal deficit. So, there is a possibility of hike in any of these — excise, stamp duty, vehicle tax, etc — in the medium term,’’ admitted the senior state finance official, who did not want to be named.
The non-tax revenue, however, may see a hike even earlier. The state government had formed a high-level committee to review how fees and fines, especially those that had not be raised in the past ten years.
“A final decision by this committee is likely soon, so there will be recommendations on how fines and fees across departments can be hiked. But, this will not pinch citizens much as these fines have been nominal,’’ said another finance department official. Mungantiwar could not be reached for his comment.
The government in 2018-19 lost Rs346 crore owing to stamp-duty exemption given to several sectors such as special townships, industrial policy, Mumbai-Nagpur super-communication highway, among others.