Maharashtra mulls imposing VAT, entry tax on import of sand

Revenue and finance departments to frame policy to prevent smuggling of sand and to increase revenue of state exchequer

Maharashtra government is mulling over a policy that may allow entry tax and VAT to be imposed on import of sand from neighbouring states to stop its illegal smuggling.

The revenue and finance department will come together and frame a policy that will prevent illegal smuggling of sand and increase revenue of the state exchequer, Revenue Minister Eknath Khadse said yesterday.

Referring to National Green Tribunal's decision of August 2013 that banned mining or removal of sand from the river beds, Khadse said this had opened doors for illegal mining in the Konkan region.

"The mining of sand had been stopped since the last two years as Awaaz Foundation had challenged it in the National Green Tribunal. This had badly affected the construction sector in the Konkan region," he said.

"Although it was banned, contractors used illegal ways for sand mining. Illegal mining has to be stopped in the state," he stressed.

Khadse said he was aware that sand was imported from neighbouring states and was used in Mumbai and Konkan region, even when there was a ban on sand mining.

"Till date, neighbouring states provide sand to Mumbai and other parts of Maharashtra. The trucks reach the city at night or early morning. There is no tax applicable on import of sand which enters in the state by legal or illegal ways. Thus, we have decided to bring a stringent law, by which we can impose Value Added Tax (VAT) and entry tax on the import of sand," the minister said.

Since tax is a subject of the finance department, the revenue and finance department will work together on the formulation and application of the new law.

"This will not only stop illegal transport of sand in the state, but will also get us revenue. However, at present it is not possible to comment on the amount of revenue that the state will generate," Khadse said.