Karnataka govt may levy hefty penalties to bridge revenue shortfall | Bengaluru News – Times of India


People may have to cough up higher penalties and fines ahead of the state budget for 2021-22 next month as the government, keen on narrowing the revenue gap, may intensify enforcement across sectors.

BENGALURU: People may have to cough up higher penalties and fines ahead of the state budget for 2021-22 next month as the government, keen on narrowing the revenue gap, may intensify enforcement across sectors.
Chief minister BS Yediyurappa, who holds the finance portfolio, formally started preparations for the budget at a meeting with the higher education department on Monday. Officials of the finance department reportedly told Yediyurappa before the meeting that the government is unlikely to meet revenue targets and it’s better to look for non-tax revenue sources such as monetising assets and ramp up collection of penalties and fines.
“Generally, small violations were ignored but the situation may change. Traders may have to be ready for hefty penalties,” said an official.
While collection of penalties has intensified, strict enforcement may continue in the new financial year since tax collection is unlikely to recover in the first two quarters.
The departments being considered for stringent enforcement include commercial taxes, excise, transport and traffic. The real estate sector is also in focus and penalties from builders through the Karnataka Real Estate Regulatory Authority that is empowered to collect penalty up to 10% of project cost from builders depending on severity of violation. While the penalty money goes to the treasury, K-RERA has already collected Rs 18.5 crore and about 500 apartments are under scrutiny.
Traffic police have collected around Rs 220 crore across Karnataka, and a record Rs 100 crore from Bengaluru city. “We’re still ascertaining the data as enforcement is a continuous process,” said Pratap Reddy, commissioner for traffic and road safety.
Yediyurappa recently convened a special meeting of enforcement officers of commercial taxes and instructed them to intensify enforcement. The department has collected about Rs 65,000 crore so far against the target of Rs 85,443 crore and final collections are expected be short by around Rs 8,000 crore. The department is trying to fill the gap by collecting penalty for e producing fake invoices and violation of e-way bill norms and it has collected an estimated Rs 3,000 crore.
Excise officials too are going strong on enforcement against violations like under stocking at outlets and selling loose bottles of liquor at wine stores. The department, on average, collects a penalty of Rs 25 crore annually, and it’s expected to be thrice that amount this time.

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Sagar Biswas

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