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Determinants and Efficiency of Stamp Duty Revenue Collection
The determinants of stamp duty revenue collection (income, tax rate) in West Bengal are studied using a unique panel data set of the state’s 19 districts from 2002–03 to 2010–11. The role of efficiency-improving conditions imposed on stamp duty revenue collection under the Jawaharlal Nehru National Urban Renewal Mission is studied. A Laffer Curve relation is found for stamp duty revenue collection. Though revenue collection fell due to the rate cut, there was an efficiency gain because avoidance in the housing market dropped, valuation software was implemented, and the circulation of fake stamp papers was prevented.
Vivekananda Mukherjee is indebted to the Centre for Training and Research in Public Finance and Policy for funding. The authors acknowledge the discussion with Sanmitra Ghosh and the research assistance from Moumita Chel, and thank the anonymous reviewer for insightful comments.
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