Life’s just got Maha costlier State Hikes Taxes, Cars Worst Hit

Mumbai: There was little cheer for Maharashtra when finance minister Ajit Pawar tabled his second budget in the assembly on Monday, with taxpayers facing the possibility of seeing any income tax gains they made in the Union Budget being totally wiped out if they purchase a new car. While Rs 22,660 is the expected gain in the highest income tax bracket, the purchase of a Rs 14-lakh petrol car, for example, will now set a buyer back by an additional Rs 30,000. Such a vehicle currently attracts a tax of Rs 1.1 lakh, which will go up to Rs 1.4 lakh in the budget for 2012-13. 

    Buyers saw 2% to 4% tax hikes across price groups for petrol and diesel vehicles, respectively. Pawar gave "environmental reasons" for the hikes, saying, "The sale of diesel cars is on the rise. The proposed tax hike is to discourage the use of diesel and petrol cars." Simultaneously, in a relief for taxis and autos, the tax for new 'green' CNG vehicles was reduced by 2%. 

    Cooking will also get more expensive, with a 5% levy introduced for LPG cylinders, which were earlier exempt. A cylinder costing around Rs 398 will now cost Rs 418. However the Congress, Shiv Sena, BJP and MNS have objected to the rise. "A Congress delegation will meet the chief minister and urge him to roll back the tax on LPG," said Sanjay Dutt, party spokesperson. 

    In a major relief to the realty industry, stamp duty rates for flats and leave-and-licence were not hiked. But sand will be taxed at source and levy on Plaster of Paris has shot up from 5% to 12%.