States’ demand on GST not acceptable, says Rvenue Secretary

New Delhi, Sep 29 (AINS) The demand for changes in the goods and services tax (GST) structure by Bharatiya Janata Party-ruled states like Madhya Pradesh and Gujarat is not acceptable as it is not consistent with the basic structure of the proposed tax reform, Revenue secrtary Sunil Mitra said.

‘We don’t find these suggestions acceptable. It is not consistent with the basic structure,’ said Mitra told reporters on the sidelines of a conference organised by CII.

Mitra said the recommendations of even the empowered committee of state finance ministers was not acceptable.

Madhya Pradesh had demand that states be given the authority to decide on the quantum of service tax. Other states too are opposing the reform as they fear it would encroach on the states’ fiscal autonomy.

‘If we allow the states to decide on service tax, what will we get?,’ asked Mitra.

The GST is to replace the central excise duty and service tax, and the value added tax (VAT) of the states, besides local levies, cesses and surcharges.

Its implementation will, however, in all likelihood miss the scheduled deadline of April 1, 2011 as there is no consensus on the issue between political parties.

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