Tue, Nov 01 2016.
In a letter to Arun Jaitley, West Bengal finance minister Amit Mitra blames the Centre for concealing the existing service tax payer base from the states
“This implies that the service tax base has grown 3 times over 2 years. What is even more surprising is that even a month ago this fact was not told to the states,” he wrote, adding that the figures seem an afterthought surfacing only after the issue of dual control was discussed in the last GST council meeting held on 18-19 October.
Mint has reviewed a copy of the letter. Emails to Mitra and revenue secretary Hasmukh Adhia have not elicited a response yet.
Initially, it was agreed that the Centre will control all the existing 11 lakh service tax dealers. For goods traders, states were given administrative control over those with an annual revenue threshold of less than Rs.1.5 crore with a sharing mechanism between the Centre and the states to be worked out for traders above this threshold.
However, states later opposed the Centre’s exclusive control over service tax payers. They sought control over the big service tax payers while some also pointed out that some of these service tax payers already are under the VAT (value-added tax) net—for example restaurants.
In his letter, Mitra also pointed out that the disaggregated data of VAT, excise and service tax base based on thresholds of Rs.1.5 crore and 20 lakh has not been shared with the states so far. He also added that the states are likely to get the updated data only by 1 November which leaves them only a day to deliberate before the GST council meeting.
Mitra’s letter comes close on the heels of Kerala finance minister Thomas Isaac expressing concerns over the rate structure and the tax rates under GST as proposed by the Centre.
With states hardening their stand on these remaining important issues, the Centre is racing against time to meet the 1 April 2017 deadline for the implementation of GST. The Centre is hoping to resolve all these issues by the third week of November so that the central GST law and the integrated GST law can receive Parliament’s nod in the upcoming winter session(http://www.livemint.com/)