India's Stamp Duty Collections Can Be Raised To Rs 2 Lakh Crore.

15-Nov-2013

Collections from stamp duty and registration fees on property and capital transactions can be more than doubled and raised to Rs 2 lakh crore through an innovative approach, progressive policy and transparency, says a study by industry body Assocham.



"With property prices skyrocketing in most metropolis and price of agricultural land too rising sharply in recent past, a progressive policy in this regard is the need of the hour," Assocham Secretary General D S Rawat said.



In India, where property transactions are often regarded as shady and undervalued to avoid payments vis-a-vis stamp duty and registration fees, an innovative approach in this regard would result in much larger collection, he added.



According to the study titled Trade Policy & Tax Regime: State Level Initiatives, Maharashtra alone accounts for over 20 per cent of stamp duty/registration fees and taxes on property transactions as the state has streamlined compliance and tax administration, thereby curbing evasion.



Smaller states like Delhi, Kerala, Haryana and Punjab too maintain robust collections on this account, a fact reflective of the real estate industry in these states, the study said, calling on other states to emulate Maharashtra's example.



"As stamp duty and registration fees collections show strong growth, state governments should do away with land revenue and property tax or factor this at the time of sale or purchase and make it a one-time payment," the study suggested.



Taxes on property and capital transactions cover two important aspects-- stamp duty and registration fees-- besides land revenue and tax on urban immovable property tax.



The Assocham study further suggested a marginal raise in motor and commercial vehicle tax and urged the government to abolish the passenger and goods tax.



Besides, the study urged policy makers to focus on increasing efficiency of tax collections with a customer friendly approach.



Money will flow into government coffers if the policy initiatives focus on 'tax collection with human face', the study said.



Source : economictimes.indiatimes.com