Printed books earlier exempted from octroi are now subject to local body tax
Book traders in Pune are a worried lot. Their worries centre around a Local Body Tax (LBT) which in May replaced octroi in the city. In 2004, municipalities in Maharashtra exempted printed books from octroi to promote reading habits among citizens. Now with the application of LBT to printed books, these have become a taxable commodity.
LBT has been imposed by the various municipalities in Maharashtra on goods entering their municipal area for sale and trade. Octroi was levied at the check-posts on the road entering the municipality area, while traders have deposit LBT at banks every month and maintain accounts. The municipal authorities believe the new levy will help reduce traffic jams and fuel consumption by the trucks waiting in queue to pay octroi.
Book traders, publishers unhappy
Sunil Mehta, owner of Mehta Publishing House says, “Though the LBT in Pune is only 2 per cent of the price of every book we sell, the actual cost that a trader or a publisher has to incur would be much more. For one, the publisher has to hire a dedicated person to look into LBT as this is going to be a monthly affair. Moreover, corporation officials will keep coming to us from time to time to review our accounts and we cannot afford to spare our regular employees to entertain them. We would be required to hire a person for that; this will definitely increase the prices.” He also rues that, “The cost of paper has increased almost 20 per cent since last year and with extra costs of LBT, prices of books are bound to shoot. Ultimately the burden will be passed onto the consumers.”
Uday Patil of Patil Enterprises, one of Pune's leading book distributors, speculates that prices of books may not rise much but discounts distributors get from publishers—which they pass on to customers—will be nullified. Patil Enterprises is one of the leading names in book distributions in Pune. “Matters can become really complicated at the time of book exhibitions. We would have to pay LBT for all books entering a particular municipality and while coming back we are supposed to get back the money we paid as taxes for all the books we could not sell. Keeping track of every book sold and getting the right amount back from the municipality would be a complicated affair. We are well to do and have computers, but imagine small book sellers having to deal with such complications. They will be badly affected by LBT,” he explains.
Different LBTs for different municipalities further complicate matters. Patil explains, “If we bought books from Delhi and took them to Thane for exhibition, we would have to pay a 2 per cent LBT to the municipality in Pune where we are located, and then another 3.5 per cent to the Thane municipality.”
Authors to lose
The new levy will also affect upcoming authors, says Arun Jakhade, working president of Marathi Prakashak Parishad. “We participate in exhibitions to promote unknown authors among readers. Because of this tax, the number of traders participating in exhibitions will go down. Rather than inculcating reading habits in the youngsters the government is creating hindrances for them. We have been visiting the municipality office almost every day to request it to exempts books from LBT,” says Jakhade.
Vilas Kanade, the joint commissioner of Pune municipality, says, “LBT will be implemented in every Maharashtra municipality, including the Brihanmumbai Municipal Corporation which has not yet implemented it, as per as the state government's directives. The state government is trying to standardise LBT. So we cannot exempt books from the tax as of now. At the most, we can try to keep the levy as low as possible.”
The only books exempted from LBT are those published by the government and those that cover school and university curricula.
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