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Department differ on quantum of GST burden
The State government is unable to come to prepare estimations correctly on the quantum of GST burden on the infrastructure projects in the State. While the Commercial Taxes, Irrigation and Roads and Buildings departments have estimated that government have to bear additional burden of Rs 19,500 crore, the Finance department has disputed the claim.
Hyderabad: The State government is unable to come to prepare estimations correctly on the quantum of GST burden on the infrastructure projects in the State. While the Commercial Taxes, Irrigation and Roads and Buildings departments have estimated that government have to bear additional burden of Rs 19,500 crore, the Finance department has disputed the claim.
A top official of State Finance Department told The Hans India that the calculations on GST burden on the projects prepared by Irrigation, R&B and Rural Development departments were technically incorrect. After introduction of the GST from July 1 this year, the prices of materials like cement, steel and other equipment have come down.
In the previous tax system, Centre has collected between 15 to 18 per cent Excise duty on materials depending on their nature. With GST in place, material costs in several cases have been reduced.
In some cases, the Finance department found that the departments have inflated the GST burden on the projects in a bid to help the contract agencies. However, the official refused to elaborate. The calculations, according to sources, have been prepared by the engineers of the respective departments without in consultation with the financial experts.
The official said the Finance department has already drawn the attention of the Chief Minister K Chandrashekar Rao on the impact of the GST on state exchequer. They said according to them, there would be no additional financial burden on state exchequer.
It may be mentioned here that Centre had reduced GST on project works from 18 to 12 per cent on the insistence of the Telangana government in the GST Council meeting held recently in New Delhi. The Chief Minister has now called for a high-level meeting with all Secretaries and financial experts to verify whether the State would face heavy GST burden or not. The meeting would be held before the GST Council meeting scheduled to be held on September 9.
