Maharashtra State targets ‘liquid’ cash in surplus budget

Drinks, Power, Cable TV Dearer

Sanjeev Shivadekar TNN

Mumbai:Afew stings were in store for the well-heeled as Maharashtra finance minister Ajit Pawar announced a surplus budget of Rs 58 crore on Wednesday. Pawar's first budget kept up the sops on the food front, while simultaneously targeting tipplers and those who like to add a little fizz to their day. Cable TV and power bills are also likely to rise following levies in those sectors. Consumers can also expect to pay more for sunglasses.
    Liquor, both foreign and Indian, is set to get more expensive due to hiked excise rates. A 750 ml bottle of Indian Made Foreign Liquor (IMFL) is expected to rise from around Rs 260 to Rs 300, while a 650 ml bottle of mild beer should go from around Rs 77 to Rs 89. Value-added Tax (VAT) in bars with a fourstar or higher rating will be 20%, while in other watering holes it will be 5%.
    These are some of the levies expected to go towards creating the surplus in the state's budget for 2011-12. In 2010-11, the revenue deficit was a staggering Rs 5,687 crore. Pawar said the turnaround would be achieved because of a 31% increase in stamp duty collection and a 26% increase in sales tax revenue.
    Cable TV could become expensive because of a 5% tax levied on telecasting rights for various sports and entertainment events.
GETTING COSTLIER LIQUOR/BEER: Hiked excise duties could be passed on to buyer. A 750-ml bottle of IMFL whisky costing Rs 260 could go up to Rs 300. A bottle of beer that costs Rs 77 will cost Rs 12 more now. VAT system restructured, but may not affect prices
POWER BILLS: Additional levy
on electricity produced and sold
SOFT DRINKS: VAT hiked from 12.5% to 20%: If MRP is Rs 20, you pay Rs 22.50 now, which will rise to Rs 24
CABLE TV: Could get costlier after 5% tax on telecasting rights of sports and entertainment
BUYING/RENTING OF FLATS UNDER PAGRI SYSTEM: Stamp duty to be paid at market rate (not agreement value)
GETTING CHEAPER
DRY FRUITS: VAT drops from 12.5% to 5% (except for raisins, currants and cashews, which are tax free): If price is Rs 600/kg, you pay Rs 642 now, which will drop to Rs 630
VADA PAV (at eateries): VAT drops from 12.5% to 5%; If the popular snack costs Rs 15, you pay Rs 16.90 now, which will drop to Rs 15.10
DHOOP, AGARBATTI: No tax
NO CHANGE
Tax exemption to continue on LPG, rice, turmeric, chillies, coconut, cumin seeds, jaggery, methi, parsely, Solapuri chaddars, towels, fabrics, sugar
Concessional 5% tax to stay on tea Stamp duty on mkt transactions
Mumbai: Finance minister Ajit Pawar adopted a hard stand on soft drinks, raising the VAT on them from 12.5% to 20%. Sunglasses will attract a 5% VAT.
    The state government has decided to levy additional duty and tax on the electricity produced and sold in the state to fund infrastructure facilities that would be improved in areas having power-generation plants. This burden could be passed to the consumer.
    Meanwhile, several dry fruits are set to get cheaper with VAT dropping from 12.5% to
5%. The Mumbaikar's
favourite snack, the vada pav, will also be cheaper with VAT falling by the same amount. An eatery selling it for around Rs 17 will now have to price it Rs 2 lower. Pawar has also decided to continue keeping the grocery list cheap, with tax exemptions to continue on items like LPG, rice, turmeric, chillies, coconut, cumin seeds, methi, parsley, jaggery and sugar.
    To please religious communities, the finance minister has proposed to exempt dhoop, loban and incense sticks from taxes.
    Stamp duty on stocks and the capital market has been amended. "Transaction of securities, futures, delivery and no-delivery takes place in the share market and commodity exchanges. The transactions are charged at different rates of stamp duty, which makes collection of stamp duty a difficult task. To bring uniformity in collection of this tax, the finance department has proposed stamp duty of 0.0005% on all these transactions," Pawar announced.
    Pawar was happy with revenue collected through tax. "Last year many states enhanced VAT from 12.5% to 13.5%; in some states it was raised to 15%. But without changing the tax rate in Maharashtra, the state has shown a record increase in the revenue collection," the finance minister said, adding, "This year too there is no proposal to increase the standard rate of VAT (12.5%)."