From Our Special Correspondent
Daijiworld Media Network - Bangalore
Bangalore, May 25: Bihar Deputy Chief Minister Sushil Kumar Modi on Friday recommended several changes in the GST Bill introduced in the Lok Sabha for its early implementation.
Modi, Chairman of the Empowered Committee on State Finance Ministers, said the states have been opposing several provisions of the Bill, including the issue of compensation for revenue loss.
States are demanding the compensation as they fear the GST will significantly dilute their revenues.
He was speaking on ``Taxation on Supplies of Goods and Services: Issues relating to State Policy, Governance and Welfare,” at a seminar organized by the National Law School of India University, Bangalore here on Friday.
“I am afraid that unilateral decision of the Centre, without even giving an opportunity to the states to put forward their point of view, is likely to adversely affect the process of tax reform in the country including the introduction of GST,” he said.
Implementation of the GST would reduce burden of taxes and make Indian products more competitive in the global market. The cost advantage would give boost country’s exports, he said.
The 13th Finance Commission has recommended grant of Rs 50,000 crore as GST compensation claim.
“The states fear erosion of fiscal autonomy by implementation of the GST,” Modi contended.
The Bill provides for creation of a GST Council to be headed by Union Finance Minister.
The Council will be empowered to recommend tax rates and exemption and threshold limits for goods and services.
Besides, the Bill proposes a GST Dispute Settlement Authority to deal with grievances of the Centre and the States with regard to GST.
The GST, considered to be a major tax reform, has been pending for the last four years due to disagreement between the Centre and some States over the structure of the new tax regime.
While the states accuse the Centre of shortchanging them, the Centre feels let down on account of the states’ delay in arriving at a deal on GST.
The Bill, which was introduced in the Lok Sabha, has been referred to the Lok Sabha’s Standing Committee for scrutiny.
The Committee would hold its first meeting on June 8 and submit report to the Government which would in turn go before the Union Cabinet, he said.