Abolition of octroi affects VMC''s finances

Posted By: Pti
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Vadodara Jan 18 (PTI) The abolition of octroi hasaffected the financial position of Vadodara Municipalcorporation (VMC) with the state government also not makinggood the fall in its revenues as promised, civic body sourcessaid.

Incidentally, the corporation has lined up a slew ofprojects worth Rs 2,655 crore for making Vadodara a model cityand is required to arrange for funds.

Gujarat government had assured VMC to fully compensate itat the time of scraping of the levy. But it has not happened,the civic sources said.

The entire collection of VAT in lieu of Octroi goes tothe state exchequer but VMC has failed in getting the assuredcompensatory amount in lieu of octroi. The corporation used tocollect about Rs 325 crore per year by way of octroi everyyear.

VMC is now likely to increase conservation tax,professional tax and water tax in the civic budget for2011-12 which is likely to be presented later this month,according to sources.

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