States Fear GST Will Dent Their Revenue: Telengana Finance Minister

Published: 07th October 2015 04:32 AM  |   Last Updated: 07th October 2015 04:40 AM   |  A+A-

HYDERABAD: The state government wants the Centre to ensure that introduction of Goods and Services Tax (GST) will not cause any loss to states’ revenue and a burden on the common man.

Finance minister Etela Rajender, who was part of a delegation of finance ministers that toured Australia to study the implementation of GST there, said they had put forth their demands before the Centre and wanted it to consider them before implementing GST.

“States should not lose their self- sufficiency and there should not arise a situation in which the state has to beg before the Centre,” Rajender told a group of reporters in the lobbies of Assembly on Tuesday.

Also, introduction of the new taxation system should not burden the common man, said Rajender who returned from Australia in the wee hours of Tuesday.

During his tour, Rajender attended nearly eight classes on GST at Sydney and Canberra. He said GST was a success in Australia and the tax revenue improved since its introduction in 2000.

Rajender said tax sharing between state and Centre should also be resolved. “When VAT was introduced, the Centre was supposed to pay Central Sales Tax compensation to states but it has paid only Rs 450 core so far. The state is yet to get Rs 4,000 crore,” he said and added that states feared that they would have the same bitter experience with regard to GST too.

With the introduction of GST, there will be single window taxation on any goods. This tax will be levied at the consumer stage.

This, however, will be a loss to states where the manufacturing is more. Officials said GST will be a loss to manufacturing states like Gujarat, Maharashtra and Punjab.


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