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Upset Telangana CM to take Centre to court over new tax regime

 While the Council reduced tax on public works in the State from 18 per cent to 12 per cent, it refused to exempt projects started before the new regime from its ambit.

Published: 06th August 2017 02:19 AM  |   Last Updated: 06th August 2017 08:02 AM   |  A+A-

By Express News Service

HYDERABAD / CHENNAI : Even as the GST Council, which met in New Delhi on Saturday, approved the e-way bill system and slashed tax rates on tractor parts, Telangana Chief Minister K Chandrasekhar Rao decided to launch a legal battle against the Centre. While the Council reduced tax on public works in the State from 18 per cent to 12 per cent, it refused to exempt projects started before the new regime from its ambit. This is understood to have angered Rao, who has decided to write to Prime Minister Narendra Modi on Sunday. 

According to sources, Rao said the State would launch a legal battle against Centre’s “unilateral” decisions. The contention is that “one government imposing tax on another is not fair.” 

Meanwhile, a vital cog in ensuring seamless transportation of goods under the new tax regime, the e-way bill system has finally received nod from the GST Council. While the date of implementation hasn’t been announced, sources say it’s likely to be implemented from October 1. Industry players hope this will finally remove disparity in way bill rules across States.

Under the system, it is mandatory to pre-register movement of all goods worth more than Rs 50,000, if transported more than 10 km for sale. While it has been clarified that transporters of exempted goods need not register, the Council has decided not to increase the exemption limit to Rs 1 lakh from Rs 50,000, as proposed. “Currently, taxpayers are facing difficulty in absence of a centralised way bill as every State has made its own rules. But after the rules are notified, there will be common procedure all-over India. The major relief is that dealers engaged in supply of only exempted goods are not required pre-registration,” asserted Vishal Raheja, Senior Consultant, Taxmann.However, small businesses might face some issues as the new system places time limits on the validity depending on the distance goods have to travel.

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