
TIRUCHY: The 18% GST levied on infrastructural projects is pinching urban local bodies like the Tiruchy city corporation hard, say civic officials. For instance, the Tiruchy corporation, which is spending Rs 349.98 crore for the upcoming integrated bus terminus, truck terminal and related infrastructure in Panjappur, pays about Rs 22.68 crore in GST for the projects since the revision of tax slab for construction works of public infrastructure projects to 18% from 12% last year.
Officials seek at least revision of the GST slab for such works to a lower one like 5%. "We pay GST not only for the Panjappur bus terminus work but even for the underground drainage (UGD) project works. Though these projects are beneficial for the public, we have to pay GST. If these projects for the public good are exempted from such tax, it would be a relief for small local bodies like Tiruchy corporation. Otherwise, the GST Council can also consider putting such beneficial projects in the 5% tax slab," a senior corporation official said.
TNIE filed an RTI with the Union Ministry of Finance requesting the reason for imposing GST on public infrastructural projects like the construction of bus terminus and bridges. The public information officer replied, "In the spirit of the RTI Act, 2005, it is kindly informed that all the decisions related to GST, including prescribing rates of tax, are made on the recommendation of the GST Council, which is a constitutional body."
The ministry then gave the details of its websites for GST tax reference. When the issue was raised with Municipal Administration Minister KN Nehru, he said, "I will raise it with the chief minister and measures will be taken for getting tax exemption for public infrastructural works."
Meanwhile, K Chinnaswamy, a retired sales tax officer and resident, noted, "I was surprised to know that GST is applicable even for public infrastructure projects like bus stands. Whatever be the reason for this taxation, why can't they put them in the lowest tax slab? The Union government has to intervene in the matter."