Mumbai and Pune To Replace Octroi with LBT
CRN, Feb 7, 2013

With 19 out of 26 municipal corporations in Maharashtra already following the Local Body Tax (LBT) structure, it is now turn of the big boys in Pune, Thane and Mumbai

While the 6 municipal corporations will replace Octroi with LBT from April 1, 2013, Mumbai will do so from October 1, 2013.

Of the 26 municipal corporations in Maharashtra, so far LBT has been adopted by 19 such as Kolhapur, Nashik, Aurangabad, Vasai-Virar. But bigger corporations such as Mumbai, Thane, Pimpri Chinchwad, which earn sizeable revenue from octroi, are yet to make the switch.

LBT is an account-based system where traders and businessmen pay the tax monthly by way of self-declaration. All the municipal corporations are yet to announce the rate of LBT that will be applicable in their cities.
The IT channel had mixed reactions on the topic. “From what I hear, BMC is planning to levy LBT of 4 percent in Mumbai. The rate of LBT on IT products in Mumbai will be more but not less than 4 percent as against Octroi rate of 5.5 percent. So there is not much reprieve in terms of lower taxation,” said Kshitij Kotak, CEO, Fortune Grecells and President, ASIRT.

Rushabh Shah, CEO, Graham Information Systems and President, TAIT, said, “Introduction of LBT would make movements of goods faster. In addition, it will address corruption that is rampant with the current system. It will also create a level playing field among the IT channel. All of us know that some operators bring goods without paying Octroi thus putting tax-paying companies at a disadvantage.”

Paresh Shah, Partner, PH Teknow and Treasurer, ISODA wants the government to provide clarity on the rate and structure as soon as possible. “We are happy to know that octroi will go from October but they have not specified the model for LBT. There is no clarity on whether the taxes will be applicable at multiple levels. For example, will the entire value chain including the distributor, sub-distributor, reseller and the consumers have to pay the LBT? If that is the case, it will increase cost and complexity at all levels.”

blog comments powered by Disqus

Product & Reviews

axis-m3027-pve-dome-camera-snapshot

Axis M3027 PVE Dome Camera

Axis Communications has launched the M3027 PVE 5MP fixed dome camera which is the latest addition to its line-up of outdoor-ready Axis M30 VE cameras....

Slideshows

On A Need To Know Basis
Six Things To Know About Microsoft's New Volume Licensing Program

Microsoft launched the Microsoft Products and Services Agreement last December. Here are six things Microsoft partners and customers need to know about MPSA

Connected Home Is A Reality
Connected Home Will Be A Reality In 5 Years

According to a survey on Internet of Things, commissioned by Fortinet, 69 percent respondents from India said that the connected home is extremely likely to happen in the next five years. Here are the...

10 Trends That Would Drive Tech Investments In India

CIOs of large and mid-enterprise segment are optimistic and are looking at investing in new solutions to fuel business growth. Gartner has identified top 10 technologies that will drive the spends in 2014....