Book on LBT (Coming Soon)

There is currently no book available in market or on Google i.e. no paper book or eBook available for reference for a LBT consultant or a Businessmen either.

But this will be no more. A complete book on LBT (Local Body Tax) covering all aspects of LBT with bare wordings of LBT rules and also covering all sections of Bombay Provincial Municipal Corporation Act (BPMC) relating to LBT is coming soon.

This book will be published as a e-book. Here's the cover page of book titled
"Local Body Tax - All that you need to know about LBT"

The contents of the book are as below. (This content is illustrative and subject to change in Final Version)

1.    Preface to First Edition
2.    About Authors
3.    Contents
4.    Section & Rules Index
5.    What is LBT?   
6.    Why LBT

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LBT on Job Work

Job Work under LBT is governed by Rule 28 (3) and Rule 28 (4), [exact wordings are mentioned at end of this post.]

The job work can be classified into two types
A - Goods coming in Thane City for Job Work
B - Goods going out of Thane City for Job Work

Here in the below diagrams and explanation - 
"Thane City" is considered as LBT area and "Mumbai" considered as area outside LBT scope (this area can be either a non LBT area or another LBT area). Now let us understand each type individually.

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LBT in a Single Page

What is LBT?

• LBT stands for Local Body Tax, which has been introduced in most of the municipalities and corporations in Maharashtra,  in lieu of Octroi or Cess. 
• It is a levy under entry 52 in the State list of Schedule VII of the Constitution of India, on the entry of goods into a city limits for the purpose of consumption, use or sale therein. 
• Thus, the recent agitations against LBT, a levy, which is constitutionally valid, have given rise to questions as to the root cause of the agitations.

Then what is OCTROI ?

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LBT Photos

I found some interesting pics about LBT, I must appreciate the creativity of the artists who made such photos.

I am sharing this as it will serve few purposes
> For completeness of this Website.
> One place to have all LBT related photos.
> Appreciate and give some recognition to the artists who created this.

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Why not LBT in VAT?

There may be some doubts as to why LBT is levied or as to why there is a need to levy LBT separately, can’t we add the levy directly to VAT and save the burden of additional taxes on the businessmen who is already burdened with tons of Taxes and compliance.

To answer the above question lets first understand as to logic behind levy of Octroi or Cess or LBT.

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Changes in Accounting

When ever there is a change in the taxation framework, the businessmen needs to bring in changes in their business systems. LBT too comes with changes which are required to be made. I have grouped changes into 2 parts 

• Changes in Billing
• Changes in Accounting

This post shall be discussing what all changes required to be made in Accounting System. 

The major change required is that of Classification. In VAT we all are used to classification of purchases into "regisreted dealers" and "Unregistered dealers" (commonly know as URD) and then further bifurcation into Out of State and Inside state purchases i.e. VAT purchases and CST purchases.

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Changes in Billing

When ever there is a change in the taxation framework, the businessmen needs to bring in changes in their business systems. LBT too comes with changes which are required to be made. I have grouped changes into 2 parts 

• Changes in Billing
• Changes in Accounting

This post shall be discussing what all changes required to be made in billing System. There are 2 changes to be made

1. Statement

If you have seen a VAT bill, you must be familiar with the wordings "I/We here by certify that my/our ..... shall be paid" this statement is compulsory to be written on every VAT bill, similar to this statement, there will be a new statement which will have to be printed on the bill for LBT Rules compliance.

Below is the statement which is required to be mentioned.

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LBT payment (update)

The due date for payment of LBT has been postponed for the month of April, 2013. The normal due date is 10th of Next month. The amendment is done to provide time for the dealers as to settle down with new Tax structure. 

Until now (11th May, 2013) no Online Payment of LBT is not activated. Dealers will have to pay only through Challan. 
The department has tied up with "Bank of Maharashtra" and LBT can be paid through any branch of BOM within thane. TMC's Bank of Maharashtra a/c no is 60130744772.

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Launching - Know your LBT No

The registration process for LBT takes about 7-8 days if done physically which is currently the only option (as the Online option is currently not working because of many bugs on the LBT Website). But you will need to put your LBT no o your Bills, Invoice, Delivery Challan.

So today launching "Know your LBT"

Just click on the link below and fill in the Details. Wait for a second to process and your LBT no shall appear. You can be sure that the LBT no which has been allotted to you is correct or not by checking the name that appears beside your LBT No.

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For Builders

There has been some noise around that what are the provisions for builder or Constructors in LBT regime.
Here is what LBT Amendment Rules, 2012 proposes to make changes in LBT Rules 2010 (Which are the original Rules governing LBT).

1. For Builders

Any Builder or Contractor has to get registered for LBT with the Corporation and then apart from normal provition for paying tax have this option to pay LBT.

No of Floors in Building	LBT payable
4 Floors	100 per Sq Meter
7 Floors	150 per Sq Meter
Above 7 Floors	200 per Sq Meter

This provision is but subject to 50% of LBT paid in advance.
Below is the photo of the notification as appearing on the website of Pune Municipal Corporation.

2. For Contractors

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Testimonials

Thanks for all your wishes.

Very informative
- Punjab National Bank 

Excellent
- Admin (navimumbaibank.com)

Very Informative and much needed for people who are getting impacted.Thanks for sharing a very useful updated information.
- Amol Athawale (Sandoz)

Good website , useful.
- Subodh Kulkarni (Colorent)


Thanks for all the info. As on date, this is most informative blog on LBT.
- Mahesh J (Japro Engineering)

Hats off to you, a fabulous work done on LBT.
I am a retailer and fast food operator in Mumbai. We are planning to keep our shops close from 8th May subject to talks between ministers and our association heads. I know only to keep close but no proper awareness programme carried out for the retailers.

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Some changes in Website

Hi Readers,
There are a few changes on this website. 

1st - Added DMCA Protection

DMCA - The Digital Millennium Copyright Act (DMCA) is a United States copyright law that implements two 1996 treaties of the World Intellectual Property Organization. This protection helps to Copyright information on the website. Hence you will see the DMCA batch on right side.
Now I hope No one will Copy and Paste contents of this website and post it as their own.

2nd - Started a new Facebook Page

Come of the readers asked me that email updates are not outdated way of notification of post on this website. So, along with the option to keep you updated on LBT, Also started a LBT page on FB 

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Section 2(31A) - LBT Defined

As per Section 2 subsection 31A of "Maharashtra Municipal Corporations Act" LBT is defined as below

"Local Body Tax" means a tax on the entry of goods into the limits of the City, for consumption, use or sale therein, levied in accordance the the provisions of Chapter XIB, but does not include cess as defined in clause (6A) and octroi as defined in clause (42)

Explanation:

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Governing of LBT

This discussion shall provide insight into what provisions of Law govern LBT.

Local Body Tax, commonly know as LBT is governed by "The Maharashtra Municipal Corporation Act, 1949" (earlier know as The Bombay Provincial Mumbai Corporation Act, 1949). A new chapter XI-B has been inserted in this act to govern the provisions of LBT. This chapter ranges from Section 152P to Section 152T.

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