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Maharashtra And Tamil Nadu Impose Taxes Over And Above GST. Centre Says, “That’s Cool”.

byRachna Srivastava
6th July 2017
2 minute read
Maharashtra-TN-GST

Do you understand the Goods and Service Tax (GST) recently implemented in our country? Chances are pretty high, that’s a no. Well, getting a grasp of the whole matter is a bit of a stretch. And, the struggle is pretty real, my friends. Amid the whole hullabaloo, we have chanced upon a vital piece of information that’s befuddled us even more about the whole matter.

Ok! So, you must be knowing that GST is deemed to be the one tax you are supposed to pay (Umm, one nation, one tax is ringing in our ears). But, sadly that’s not the case with Maharashtra and Tamil Nadu. The two states are imposing additional taxes to meet the shortfall on taxes that have been subsumed under GST.


Confused? Well, let’s simplify. The present GST includes multiple taxes including central excise, value-added tax, service tax, octroi, sales tax and entry tax, etc. But when it comes to entertainment tax, the state has been given powers by the centre to impose additional taxes over and above GST. :O

 

Tamil Nadu will be imposing a 30 percent state entertainment tax over and above the 28 percent entertainment GST.

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The theatre owners are protesting the move because this means that the price of tickets would be more expensive than other states. For years, the ticket prices were capped at Rs. 120, in the state.

 

Maharashtra has increased the motor vehicle registration tax by 2 percent. So, the tax for petrol and diesel vehicles will be 13-15 percent and for two-wheelers, it will go up to 10-12 percent (depending on the type of vehicle and its price).

This move will compensate for the combined revenue loss of Rs 600-700 crore annually that Maharashtra will lose on local body taxes and octroi (which was a big source of income) after the GST implementation.

 

The Centre says that the states may impose mandi (wholesale markets) tax and vehicle registration fee and raise the entertainment tax beyond the GST rate. Huh? Pratik Jain from PwC India told MoneyControl,

“Since state local bodies have been given the powers to impose additional entertainment tax over and above GST, some of them have gone ahead and imposed them. States which did not have this tax earlier should be persuaded to not impose this.”

My brain is still stuck upon the One nation, one tax motto. Are Maharashtra and Tamil Nadu not part of this nation? And, will other states too follow suit and impose more taxes on and above GST? *dreading the answer*

Source: Moneycontrol

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