Luxury Tax Act

The Maharashtra Tax on Luxuries was instituted in 1987, according to Western India Regional Council of the Institute of Chartered Accounts of India (WIRC). Maharashtra is one of the wealthiest states in India, according to Your India Portal.

  1. Hotels

    • The Luxury Tax is imposed upon hotels in Maharashtra, India, for providing residential accommodation. The tax is levied at different rates, according to WIRC. The tax rate is based upon how much a hotel charges its clients for rooms. Hotels that charge customers less than 200 Rupees per day for a room are not liable for a luxury tax. Hotels that rent rooms for 200 to 1,200 Rupees are charged 4 percent. Those that rent rooms for more than 1,200 Rupees are charged at a 10 percent luxury tax rate.

    Tobacconists and Textiles Traders

    • The state government of Maharashtra levied Luxury Tax on tobacconists and textiles traders, as well. However, the Supreme Court of India struck down levying this tax on tobacco in the case of Godfrey Philips India, Ltd. v. State of U.P. and Others in 2005, according to WIRC. The Maharashtra Government removed the tax on tobacconists and textile traders in 2006.


    • The Luxury Tax of Maharashtra may be appealed through the office of the Assistant Commissioner, otherwise known as the Deputy Commissioner. The second appeal goes through the Commissioner of Luxury Tax, according to WIRC. An appeal should be filed within 60 days of communication of order. There are varying tax fee stamps for each appeal, pursuant to Rule 47 of the Luxuries Rules.

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