MAHARASHTRA BUDGET 2015-16

The State Budget of Maharashtra for the fiscal year 2015-16 was presented by Maharashtra’s Finance Minister Shri.Sudhir Mungantiwar on 18th March,2015. The government has declared that the Local Body Tax (LBT) will be abolished from 1st August,2015 and the government would compensate the revenue by enhancing the VAT Rate. The government will provide a compensation of Rs.6875 Crores to the Municipal Corporations excluding Mumbai.

The government has made certain amendments in the MVAT Act and tax concessions is provided for few items, whereas tax concessions on essential commodities has been extended upto 31st March,2016. Some medicines for cancer treatment has been made tax-free, which will be later notified by the government. 5% Entry tax will be applicable on long steels. The government has also removed ambiguity in tax rate for certain items.

Increase in VAT Rates –

Extension of Tax Concessions for essential commodities-

For the following commodities, tax concessions is extended for one more year from 31st March,2015 till 31st March,2016 :

1. Exemption for Essential commodities like

1) Rice,
2) Wheat,
3) Pulses,
4) Flour,
5) Turmeric,
6) Chilies,
7) Tamarind,
8) Jaggery,
9) Coconut,
10) Coriander seeds,
11) Fenugreek,
12) Parsley (suva),
13) Pappad,
14) Wet dates,
15) Solapuri chaddars and
16) Towels

2. Tax exemption on Currants and Raisins will also continue upto 31st March,2016.

3. Lower rate of 5% tax on tea will also continue upto 31st March,2016.

TAX CONCESSIONS-

VAT rates are reduced for the following items :

CERTAINTY IN TAXATION -

1. Medicines For Cancer Treatment -

Certain medicines required for cancer treatment will be exempted. The list of such medicines will be notified separately by the Maharashtra Government.

2. White Butter-  from 1st Sep,2005 =5% & - from 1st April,2010 =4%

3. 5% tax rate on spices - ‘Spices including cumin seed, asafoetida, aniseed, saffron, pepper and poppy seeds’. The above schedule entry is amended so as to include 5% tax on ready-mixture of spices.

4. Embroidery Thread à Taxed at the same rate as that of sewing thread @ 5%. AMENDMENTS IN MVAT ACT- The government has made some amendments in Maharashtra Value Added Tax Act.

1. No VAT on Service Tax - Sales Tax as well as Service tax is levied on some composite supplies. In order to avoid cascading effect of tax, the government has proposed that Sales Tax will not be levied on Service Tax collected separately.

2. Revised Return - The dealer is allowed to file multiple revised returns, in case of audit findings or investigation proceedings by Sales Tax Authorities. Prior to this, the dealer was allowed to file the revised return only once.

3. Delay in filing return - Late fee has been reduced from Rs.2000 to Rs.1000, in case of delay in filing the VAT Return.

4. Assessment Procedure - The assessment procedures can be initiated, if the tax payer is not discharging his tax liability or evading the tax. 5. Time limit is introduced for

a. completion of transaction-wise assessment and

b. cancellation of order, if the order is done ex-parte.

6. Computation of interest -

Interest will be computed wef 1st October of the year for which the revised return relates. Amendment is proposed for computation of interest in case of a revised return filed for a period lesser than a year.

ENTRY TAX –

Entry Tax of 5% will be levied on Long Steel. To avoid double taxation on long steel, set-off will be allowed as per provision.

Budget 2015-16 - Budget Highlights

Budget 2015-16 - Finance Minister's Budget Speech