HYDERABAD: Deputy Chief Minister Mallu Bhatti Vikramarka has opposed the proposal to bring Aviation Turbine Fuel (ATF) under the GST net, saying that the state presently has very limited sources of revenue generation. So far, ATF is taxed by the states under the relevant state VAT Acts.
He requested the GST Council to maintain status quo on the issue.
On Saturday, Vikramarka participated in the GST Council meeting chaired by Union Finance Minister Nirmala Sitharaman at Jaisalmer in Rajasthan.
During the meeting, the representative from Andhra Pradesh requested to permit the state to levy 1% cess on B2B transactions under GST to meet the expenses for reconstruction and rehabilitation due to recent floods.
Responding to this, Vikramarka stated that Telangana too suffered extensive damages by the same calamity and requested a similar arrangement to be extended to the state. On the recommendation of the GST Council, the matter has been referred to a Group of Ministers (GoM), in which Telangana has also been included.
On the subject of recovery of excess ad-hoc IGST apportionment made in earlier years, the Committee of Officers (CoO) presented different options for the recovery of the same. Vikramarka informed the Council that the ad-hoc apportionment was done to states as per base rate of revenues for 2015-16, but over time negative balances have accrued in IGST due to which recovery was proposed from states.
He requested the Council to base the recovery of excess ad-hoc apportionment done till now on the base rate of revenues for 2015-16. The Council agreed to this request.
Further, Vikramarka requested that recoveries, if any, should be made only in the next financial year in order to prevent fiscal hardships to states at the fag end of the financial year.
The deputy chief minister suggested that the matter of the applicable rate of tax on delivery services should be studied in further detail. He proposed setting up a Committee of Officers to examine the issue, and to make a decision based on its report. The Council accordingly constituted a Committee of Officers, of which officers of Telangana are also included, to examine the matter and to submit a report.
On the issue of closure of the Group of Ministers (GoM) on analysis of GST revenue constituted in 2019, the deputy chief minister informed the Council that Telangana was is in favour of recommending continuation of the GoM, by suitable reconstitution of the GoM as study of state wise and sector wise revenue was invaluable for taking informed policy decisions.