Duty on liquor, cars hiked

MAHARASHTRA BUDGET 2006

The Maharashtra Budget for 2006-07 has proposed to mop up an additional Rs 500 crore largely through an increase in the tax on liquor, four wheelers and cable television.

Presenting his seventh Budget, Maharashtra Finance Minister Jayantrao Patil also announced a slew of measures to control costs, improve governance and create additional infrastructure to attract investments.

Elaborating on the tax proposals, Patil said the minimum excise duty on country liquor would be Rs 155 per proof litre instead of Rs 150.25 charged at present. The minimum excise duty on Indian Made Foreign liquor (IMFL) would be Rs 160 per litre (Rs 150 being the old rate) and the duty on mild beer would be Rs 15 per bulk litre, up from Rs 12 charged earlier, he added.

Privately owned motor vehicles will now have to pay 7 per cent of the cost as a motor vehicle tax as against the present 4 per cent. Patil defended the hike saying neighbouring states charged 4 to 9 per cent tax on similar vehicles.

The cable TV sector, too, has found a place in Patil's books as the entertainment duty on cable television has been increased by 50 per cent. The royalty rates on minor minerals have been increased from Rs 50 to Rs 60 per brass and water rates for irrigation and non-irrigation use will now cost 15 per cent more.

To display an investor-friendly face, the government will announce a new investment policy to upgrade infrastructure, usher in labour reforms and improve interface with the state machinery.

A study group will be set up to review all non-tax registrations and licences required by industry, trade or professions under different Acts, rules and regulations. This exercise, which will be undertaken in consultation with industry, is expected to be completed before December 2006.

The outsourcing units in the Mumbai-Pune region cater to 23 per cent of the total outsourced assignments to the country. Concrete efforts would be put in to develop Pune as a prime IT-investment destination in the country, Patil said.

Also, mega projects have been redefined as projects involving investment of over Rs 500 crore and above or employing over 1,000 employees in 'A' and 'B' areas, and over Rs 250 crore and above or employing over 500 employees in C, D, D+ areas and no industry districts. These units will get customised package.

The state expects a revenue of Rs 59,145 crore and expenditure at Rs 58,840.30 crore for the next fiscal year. It had estimated a revenue surplus of Rs 265 crore for the 2005-06 year ending March 31, 2006, but occurances like the Mumbai floods last July, the package for farmers in distress and an increased power subsidy made the state report a revenue deficit of Rs 1,419 crore for the current fiscal year.