Prithviraj Chavan slams state over octroi, LBT after GST notification

Sep 20, 2016 | 

• Age Correspondent
 

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• Mumbai

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Finance minister Sudhir Mungantiwar and former chief minister Prithviraj Chavan with others at the occasion

Former chief minister Prithviraj Chavan has lambasted the state government and the Sena-run BMC for collecting octroi and LBT (Local Body Tax) after the Centre issued a notification on section 17 of GST, which takes away the right of municipal corporation from collecting octroi and LBT.

Mr Chavan also took barbs at state finance minister Sudhir Mungantiwar on the issue while speaking at a seminar on GST held at the University of Mumbai on Monday. Mr Mungantiwar was also present on the occasion.

Mr Chavan said that the Centre had erred by implementing the GST and caused a loss of crores of rupees to the nation. Mr Chavan’s criticism comes in the backdrop of the BJP government managing to pass the GST Bill with the support of the opposition that included the Congress.

The effect of section 17 of the Constitutional Amendment Act on GST allows for central excise to be imposed only on petroleum products, natural gas, aviation turbine fuel and tobacco products. This implies that the section takes away the government’s ability to levy central excise on other goods effective September 16 as GST. GST will replace central excise when it will come into effect on April 1, 2017.

Mr Chavan said that after the notification was issued on September 16, the state government and the BMC continued collecting octroi and excise in Mumbai, which was against the decision of the Centre.

“...under section 17 of the Bill, municipal corporations had no authority to collect octroi or LBT from those having annual turnover of above Rs 50 crore. The only exception was for collection of excise on petroleum and tobacco products. But the BMC has collected the same over the past four days and hence should remit the amount thus collected,” demanded Mr Chavan.

Replying to Mr Chavan’s barbs, Mr Mungantiwar said, “The notification was issued erroneously and the concerned minister had said it will be withdrawn, hence the question of returning the amount collected towards octroi and LBT does not arise.”