Stamp Duty Hike in Maharashtra? State Revenue Set to Increase by INR 150 Crore Annually

Mumbai:

The Maharashtra government is gearing up for a significant amendment in the stamp duty regulations, poised to impact the real estate and business sectors. Here's a detailed breakdown of the proposed changes and their expected impact.

State Cabinet Approves Amendments to Stamp Act

The Maharashtra state cabinet has approved a proposal to amend Schedule I of the Maharashtra Stamp Act, 1958. This move, according to a government press release, is aimed at simplifying the categorization of document types and enhancing ease of doing business within the state.

Projected Revenue Boost of INR 150 Crore Annually

The revision of the stamp duty is expected to increase state revenue by Rs 100-150 crore annually, creating a substantial financial boost for Maharashtra.

Stamp Duty Levied on Instruments, Not Transactions

Under Schedule I of the Maharashtra Stamp Act, the stamp duty is applied based on the instrument type rather than the transaction itself. These instruments include a wide range of legal documents such as debt acknowledgments, administration bonds, adoption deeds, affidavits, and agreements.

New Court Award Stamp Duty Structure

One of the notable amendments is in the stamp duty applied to court awards, including those related to company mergers, restructuring, liquidation, or division. Previously, a minimal fee of Rs 500 was charged for the registration of such documents. The revised structure now proposes that awards valued up to Rs 5 lakh will remain at Rs 500, while awards exceeding Rs 5 lakh will incur a stamp duty of 0.3% of the market value.

Hike in Stamp Duty for Document Registrations

Additionally, documents that previously required Rs 100 as stamp duty for registration will now face an increased charge of Rs 500. This adjustment reflects the government’s effort to streamline and modernize the existing system while maximizing revenue generation.

Article of Association Stamp Duty Increase

A key change is also proposed for the stamp duty levied on the Article of Association of Companies. The current duty of 0.2% will be increased to 0.3%, translating from Rs 50 lakh to a maximum of Rs 1 crore, depending on the market value.

Conclusion: A Positive Step Towards Simplification and Revenue Growth

These amendments aim to simplify the stamp duty process while ensuring the state benefits from increased revenue. The changes, once implemented, are set to impact various sectors, particularly real estate and corporate transactions in Maharashtra.