Motorcycles and bikes in Maharashtra are set to get costlier with the government hiking tax on two-wheelers and three-wheelers in its 2016-17 budget.
The state currently charges a 7 per cent tax on two-wheelers and three-wheelers for personal use and a 21 per cent tax on vehicles bought by companies and undertakings. The government has now decided to increase these rates and levy the tax depending on the engine capacity of the vehicles.
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For vehicles with an engine capacity of up to 99 cylinder capacity (cc), the government will charge a tax of 8 per cent. For the vehicles with an engine capacity of 100 to 299 cc, the tax rate will be 9 per cent and for two-wheelers and three-wheelers with an engine capacity of more than 300 cc, the state will levy a 10 per cent tax. In case of purchase by companies and undertakings, and on imported vehicles, the tax rate will be double the respective rates, says the budget report.
Overall, the state is estimated to earn net additional revenue of Rs 363 crore from the various tax hikes it has proposed for 2016-17.
Products such as petrol, diesel, Indian Made Foreign Liquor (IMFL), country liquor, cigarettes, cold drinks, gold, diamonds, diamond jewellery and imitation jewellery will continue to be taxed more due to the drought in the state. The additional tax for crop compensation, crop insurance and integrated watershed management was levied in October 2015 after severe agrarian crisis in several parts of the state.
“I have reconsidered the increase in tax rate and decided to continue with it for one more year as provisions will be required in future to mitigate the distress faced by farmers,” state Finance Minister Sudhir Mungantiwar said.
The government has raised Value Added Tax to 5.5 per cent from 5 per cent, barring on declared goods such as coal, cotton yarn, crude oil, steel, jute and sugar.
The state has decided to cut tax on students’ stationary items such as pencil box, all types of glues, stapler pins and files to 5 percent from 12.5 percent. A tax waiver has been given for mammography machines, battery-operated and hybrid buses and bamboo products, except furniture.
The government has refrained from imposing taxes on e-commerce companies in this budget. However, to keep a tighter tab on the flourishing e-commerce businesses in Maharashtra, the state has proposed to periodically get information from these firms about their transactions made on web portals. The government will impose penalties on portals that do not furnish this information.