Industry & Economy
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Taxation
Maharashtra may make VAT compensation claim of Rs 250 crore for Q1
Our Bureau
New Delhi
,
Aug. 23
MAHARASHTRA is likely to make a compensation claim of Rs 250 crore to the Central Government for the shortfall in tax revenues recorded by the State in the first quarter of the current fiscal on account of the introduction of State-level VAT from April 1.
The claim is being made as the revenues from VAT items have fallen short of the projected levels. As against a projected revenue level of Rs 2,701 crore, the State has collected revenues of Rs 2,451 crore from VAT items during the first quarter.
Maharashtra would submit its claims to the Centre this weekend or the next week, Maharashtra Sales Tax Commissioner, Mr B.C. Khatua said here on Tuesday. The VAT commissioners and sales tax commissioners met here today as part of the preparatory process for Wednesday's VAT panel meeting.
As per revenue projections arising from the compensation formula, Maharashtra is to achieve revenue of Rs 13,000 crore during fiscal 2005-06 from items under VAT, as against Rs 10,800 crore recorded for the same items in 2004-05 under the erstwhile sales tax regime.
Meanwhile, the State may bring down its VAT rate on bullion if an amicable solution is not arrived (at Wednesday's meeting) on the controversial issue of non-adherence of uniform floor rates (UFR) by certain states. Maharashtra is unhappy that its bullion trade is getting diverted to Gujarat on account of lower sales tax rate (lower than the UFR of 1 per cent) on bullion in the latter State.
Delhi is also looking to lower its VAT rate on bullion as it is aggrieved over loss of bullion trade to Rajasthan, which has pegged its sales tax rate at 0.25 per cent for precious metals. Delhi has been adhering to the UFR principle and had pegged its VAT rate on bullion at 1 per cent.
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