The Finance Budget of Maharashtra has been announced for the financial year 2019-2020. We have captured the major amendments proposed to be introduced with regard to Maharashtra VAT and Profession tax laws.
Maharashtra Settlement of Arrears of Tax, Interest, Penalty or Late Fee Ordinance, 2019
- The first phase of the settlement scheme has been extended till 31 July 2019 and the second phase till 31 August 2019.
- The arrears as per statutory orders
passed and returns or the revised returns filed on or before 16
August 2019 shall also be eligible for settlement scheme.
- To arrive at the amount eligible for settlement, steps to be followed are as under:
- First - The amount paid till 31 March 2019 shall be reduced from the total tax outstanding
- Second - The ratio, as provided in the Ordinance, shall be applied to the balance amount to determine the undisputed tax and disputed tax that is eligible for settlement.
- Now, instead of treating tax,
interest, and late fee as undisputed, only the tax will be treated
as undisputed. This amendment will enable a large number of
taxpayers to avail the benefits of the Settlement Scheme.
- The existing provision of the
Ordinance provides that the applicant, on payment of the requisite
amount, is entitled to the waiver of the balance amount of arrears
in respect of disputed tax, interest, penalty, and late fee. It is
clarified that if the amount paid is less than requisite, such
amount will first be adjusted against the undisputed tax in full
and then the remaining amount, if any, will be adjusted
proportionately towards the disputed tax, interest, penalty, or
- Only the tax amount recommended by
the auditor in Form-704 and accepted by the dealer is proposed to
be considered as undisputed. This will give relief in respect of
interest and late fee.
- The applicant, who has taken the benefit of the ordinance for payment of arrears of Entry tax, cannot claim set-off of such Entry tax paid under the Maharashtra Value Added Tax Rules, 2005.
- The amendments shall be effective retrospectively from 1 April 2019.
Profession Tax Act
- All professionals, holding an enrollment certificate, are liable to pay profession tax every year in advance up to 30 June of such year. Now, in accordance with the "Ease of Doing Business" policy, this due date is being extended to the end of the respective year. This amendment will be made applicable to 2019-20.
- Provision for a penalty in respect of delay in obtaining an enrollment certificate has been done away with. Instead, a levy of fixed interest at the rate of 1.25% per month has been proposed.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.