GST has failed to achieve its objectives: Balagopal

 









The Goods and Services Tax (GST) has failed to achieve its professed objectives and has badly hit the finances of States, including Kerala, Finance Minister K. N. Balagopal said on Friday.

Delivering the inaugural address at the international seminar on ‘India’s experience with GST organised by the Gulati Institute of Finance and Taxation (GIFT), he said that this year Kerala would have a shortfall of ₹13,000 crore in GST compensation alone. Next year the shortfall is likely to be around ₹10,000 crore.

“We are witnessing a worst-case scenario where the revenues of the States are plummeting,” he said.


Mr. Balagopal said corrections can be made in the system through careful

deliberations and a systematic approach.

The GST is a vital issue which questions the existence of cooperative and fiscal federalism, he said. The States had ceded 44% of their rights to collect indirect taxes when GST was rolled out, while the Centre relinquished only 28%. Nonetheless, the revenue sharing between the Centre and States is based on a 50:50 ratio, he pointed out.

The Centre has also been engaging in the practice of raising indirect taxes while offering sops to direct tax payers, especially on corporate income tax, he said. It was widely propagated that prices would come down sharply when GST is introduced, but the opposite happened.

Mere introduction of GST will not reflect on market prices, he said, citing the examples of LPG and Kerosene.
Call for revamp

Former Finance Minister T.M. Thomas Isaac called for a revamp of the GST system. The experience with GST so far has been disappointing for all stakeholders, he said, adding that it is important to have midway course corrections and restructuring of the system. Something has to be done to ensure to ensure tax revenues remain buoyant, he said.

GIFT Director K. J. Joseph and Associate Director Anitha Kumary L. also spoke at the inaugural session.

Experts from various states and abroad are participating in the two-day event which concludes on Saturday.


Download our App to get knowledge updates: https://play.google.com/store/apps/details?id=com.app.gstmitra


Join Our Telegram Channel for more updates:https://t.me/praveengst













Comments

Post a Comment

Popular posts from this blog

Centre appeals against ruling on levy of GST on maintenance charges to resident welfare associations

Image
  The Centre has preferred a writ appeal before the Madras High Court against a single judge's order that flat or villa owners paying more than ₹7,500 a month towards maintenance charges to their residents’ welfare associations must pay Goods and Services Tax (GST) at the rate of 18% only for the amount exceeding ₹7,500 and not for the entire monthly contribution. Justices T.S. Sivagnanam and Sathi Kumar Sukumara Kurup on Wednesday allowed an application filed by the Centre to dispense with production of a certified copy of the judgment passed by Justice Anita Sumanth recently and directed the Registry to list the appeal for admission in the usual course. Justice Sumanth had in July this year quashed an order passed by the Authority for Advance Ruling (AAR) on June 21, 2019 as well as a consequent circular issued by the Department of Revenue under the Union Finance Ministry on July 22, 2019 since both of them had insisted upon collecting GST for entire monthly contribution. The jud
Read more

Seven key things to know before filing income tax return (ITR) for FY21

Image
  The last date to file income tax return for the financial year 2020-21 has been extended to September 30, 2021. Although there is more than two months left for the deadline to end, it is always recommended to complete the task as soon as possible and not to wait for the last minute. Worth mentioning here is that the income tax department last month launched a new e-filing portal (www.incometax.gov.in) to speed up the processing of tax returns. The I-T department will soon launch a mobile application, having all the features of the new portal. This year taxpayers have to take care of the following changes in the ITR filing process. 1) A new utility named JSON has been launched for filing tax return forms for FY21. At present, only three forms, ITR 1, 2 and 4 have been released. These new forms will import pre-fill data such as personal details, salary income, dividend income, interest income, capital gains and all the information available in Form 26AS. 2) Taxpayers will have the opti
Read more

Income Tax Return or ITR for FY20 Can Be Filed Till May 31

Image
  n the wake of severe Covid-19 pandemic, the Central Board of Direct Taxes (CBDT) has decided to extend timelines of various tax compliance dates on Saturday. “In view of the adverse circumstances arising due to the severe Covid-19 pandemic and also in view of the several requests received from taxpayers, tax consultants & other stakeholders from across the country, requesting that various compliance dates may be relaxed, the Government has extended certain timelines today," the ministry of finance said in a statement. The move is aimed at mitigating “the difficulties being faced by various stakeholders," it further added. The “relaxations are the latest among the recent initiatives taken by the government to ease compliances to be made by the taxpayers with the aim to grant respite during these difficult times," it mentioned in a notification. “It’s a welcome move to extend the timeline of various tax compliances as the country is struggling with severe second wave
Read more