The Confederation of Indian Industry has welcomed the imposition of Local Body Tax, which came into effect from April 1, 2013, in Thane, Navi Mumbai, Nagpur, Pune and the Pimpri-Chinchwad municipal corporations.
The State Government has formally abolished Octroi and replaced it with LBT. Mumbai is to witness its introduction from October 1, 2013.
Over the years, the CII has been raising the issue of abolition of Octroi during its various interactions with the State Government and has noted that it is a great initiative that will prove to be a game changer in the coming years.
Ninad Karpe, Chairman, CII Maharashtra State Council and CEO Aptech, said the book-based taxation structure would help in easing out the issues of Octroi, which was creating bottlenecks for the industry in Maharashtra.
The LBT would bring in transparency in tax collection and also reduce the physical burden of paying taxes at the toll centres (termed locally as check nakas), he added.
Ashwini Malhotra, Vice-Chairman, CII Maharashtra State Council and Managing Director, Weikfield Foods, said that it would reduce the delays that used to take place at the check nakas, which resulted in disruption in production and distribution schedules.
Moreover, he added, the cost of collecting LBT would be significantly lower than that of Octroi and would translate into huge savings for the administration.
Added S.M. Kulkarni, Vice-President, Corporate Sales Tax, Mahindra and Mahindra Ltd, any new tax always has some teething problems as was witnessed when VAT (value added tax) was implemented in the State.