Under the Indian Constitution, stamp duties and registration fees are categorized into two distinct types based on their governance:
Union List (Entry 91):
Responsibility: Central Government.
Coverage: Bills of exchange, cheques, promissory notes, letters of credit, insurance policies, share transfers, and debentures.
Key Feature: Uniform rates across all states.
Revenue Collection: Managed by State Governments.
Revenue Allocation: Retained by State Governments. State List (Entry 63):
Responsibility: State Governments.
Coverage: Varied items, commonly including property transfers.
Key Feature: Exclusive power to State Governments to set stamp duties for listed instruments.
The Central Government sets the rates for specific instruments under the Union List, while the State Governments have the autonomy to determine stamp duties for other instruments under the State List.
The collection of duties, even for instruments under the Union List, is a state responsibility, with the states retaining the revenues.
The nature of taxed items under the State List can vary from state to state.
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