VIJAYAWADA: The Department of Prisons and Correctional Services has strongly opposed the move of the Goods and Services Taxes (GST) department to bring it under the tax ambit. Prisons DG wrote a letter to the Special Chief Secretary to the State government (Revenue & Commercial Taxes), requesting exemption from the GST as per the GO issued on September 10, 1991.
The department, in its eight Central Jails and Special Prisons for Women in the State, is producing/manufacturing more than 30 products such as garden products, toilet cleaner, soaps, tooth paste, dish wash bars, groundnut oil, vegetables and others and recorded a revenue Rs 9.5 crore in 2020. In 2019, the department generated a turnover of Rs 15.62 crore.
A total of 1,360 prisoners, including female inmates, are involved in various works in jails and most of the products are being used for the daily needs of the inmates and the rest are being sold in the open market at cheaper rates. “In fact, the department is not focussed on income generation. We are providing vocational training to the inmates so that they can learn something during their jail term and start a fresh life after being released,” the Director General of Prisons Mohammad Ahsan Reza told TNIE.
He said the GST officials sought the details of revenue generation and profits of the department through the sales of products a few months ago. With the GST officials trying to bring the department under the tax net, officials requested the State government to exempt it from the taxes.
Before the GST regime, the State government exempted the department from paying taxes on the products manufactured in jails under GO no: 829, Revenue (CT-III) under section 9 of Andhra Pradesh General Sales Tax act,1957. Reza said the tax burden on the Prisons Department will create problems for the holistic correctional process of the prisoners during their jail term, thus leaving them with no career options after being released.
“We are paying taxes while purchasing raw materials for vocational training and manufacturing of goods in the jails. For paying GST, we need to increase the prices of products manufactured by the prisoners, which, in turn, will impact the revenue. Though we record more than Rs 9 crore revenue, the profit is less than Rs 2 crore, which will be used for incentives and infrastructure development purposes,” the DG explained.
Of the total profits earned through the sales, 50 per cent of the amount will be spent on incentives for prisoners and the cash will be deposited in their ‘Prisoners Private Cash’ account. And, the rest will be spent on providing facilities in the prisons, welfare activities for the prisoners, correct wear and tear of machines, supervising charges and other purposes.
“The training is giving hopes to the inmates. Without expecting anything from the government, we are creating our own infrastructure through the income from the sale of our products. We hope the government will consider our request and do the needful,” Reza said, adding that the Special Chief Secretary is yet to respond to the letter.