Don’t hike octroi, end tax evasion, insists PNS

Pune Nagarik Sanghatna (PNS) has demanded that the Pune Municipal Corporation (PMC) should focus on ensuring efficient recovery of octroi and prevent tax evasion, instead of increasing octroi on various commodities.

The PMC has proposed to increase octroi on various commodities like petrol, diesel, vehicles, cooking gas and furniture. The proposal would be considered by the standing committee on Thursday.PNS activist Vivek Velankar said the PMC had recently

organised a seminar on ‘Alternative to octroi’, where the tax committee chaiman of the Mahratta Chamber of Commerce Industries and Agriculture (MCCIA), Govind

Patwardhan, had said that there is annual turnover of Rs2 lakh crore in trade in Pune district, considering the returns of VAT (value added tax).

Velankar noted that if one considers that there is turnover of Rs1 lakh crore in the city, then octroi had the potential to
generate Rs2,000 crore in revenue for the PMC.

He said that there is not even 60% of octroi recovery in the city on account of tax evasion and pilferage. The solution to garnering more revenue would be to make octroi collection more efficient, he added.

Instead of increasing octroi to cover up the failure of the PMC administration, Velankar suggested that octroi should be linked to turnover of trading firms. This, he said, would ensure higher revenue through octroi in spite of reducing the rate of
taxation.