Maharashtra traders agree to call off LBT strike: All you need to know

Traders in Pune, Pimpri Chinchwad, Navi Mumbai and Thane call off strike

Section of traders in Maharashtra on Monday night agreed to call off their prolonged agitation protest against the Local Body Tax (LBT) after a meeting with Chief Minister Prithviraj Chavan in Mumbai

Chavan held lengthy discussions with traders, which ended late on Monday evening, after which some of the participants at the meeting announced that the traders would be calling off the stir.

“Traders in Pune, Pimpri Chinchwad, Navi Mumbai and Thane have announced that they are calling off the stir, following discussions with the CM,” an official spokesperson said.

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According to a report in Hindustan Times, the state government managed to break the logjam over the proposed LBT by creating a divide between Mumbai and non-Mumbai traders. It seems, the government working out an amicable solution with the traders from outside Maharashtra, who have finally called off the strike.

What is LBT?

[caption id=“attachment_800891” align=“alignleft” width=“380”] Octroi, a key revenue source for the civic body, was replaced with LBT on April 1[/caption]

All shops -from milk dairy to grocery stores, malls and mobile recharge store-have been shut due to tax issues. Local body tax is a tax which will be imposed in months to come by the Maharashtra government on certain items that are brought into a municipal corporation territory for sale or consumption. Unlike the Octroi, where the vehicles which carry the goods had to under go physical checks at the toll booths, with LBT, that won’t happen. In fact, once LBT comes into picture, Octroi will be history.

Why are traders on a strike?

With LBT, the shopkeeper will have to pay the tax using various modes of channels. This could be over the counter at the civic body, the authorised banks, or even at the LBT portal which the civic body will put in place. All traders/ shopkeepers, who sell goods worth more than a certain amount have to pay this tax.early 24 municipal corporations will start implying LBT in Maharashtra. And, as per the LBT rules it is the responsibility of the traders to maintain records and also pay the tax.

Traders argue that with VAT in place across the country, LBT will be like double-taxation. Prices of goods are affected by VAT as well as by state or municipality-level taxes. Also, complying with various rules on self-declaration, record maintenance, account books, etc. could be an added cost under the LBT regime.

What was discussed in the meeting with Chavan?

An issue that was discussed at Monday’s meet was appointing serving and retired sales tax officials on deputation in municipal bodies to assess the LBT as they were familiar with the taxation system.

Chavan assured traders that necessary amendments would be made in provisions like registration limit, he said.

“The LBT tangle has been resolved. The agitation was on for the last 20-22 days against the adverse stipulations for implementation of LBT. Now, the issue has been resolved,” he said.

The state government had indicated that it might agree to some of the traders’ demands.

With PTI inputs