GST committee to visit States to address their concerns

The Select Committee of Rajya Sabha on Goods and Services Tax (GST) will go on a four-day tour to Chennai and Kolkata to gather the views of State governments and experts in the region.

Former Finance Ministers of West Bengal and Kerala, Asim Das Gupta and TM Thomas Isaac, will meet the members of the panel in Kolkata and Chennai, apart from representatives of chambers of commerce, public sector undertakings, local bodies and banks.

A source in the panel told BusinessLine that the effort is to reach out to States and Union territories to address their concerns.

After a meeting of the empowered group of State Finance Ministers with Finance Minister Arun Jaitley, the States had demanded that full GST compensation be paid at least for a period of five years through an independent mechanism, which should be built in the Constitution.

KM Mani, the Chairman of the empowered group and Kerala Finance Minister, told the panel earlier this week that 100 per cent of the GST compensation should be paid by the Centre for at least five years. Mani had also raised concerns over the additional 1 per cent tax on supply of goods to help the manufacturing States. He said many States feel that such a tax is against the spirit of GST, which is a destination-based tax, and will have a cascading effect, as the cost of goods and services for consumers will increase.

He had also urged the panel to take care of the concerns raised by States on issues, such as the Centre’s share in inter-state trade of Goods and Services Tax (IGST), entry tax, additional tax on tobacco and tobacco products among other issues. “We can discuss all such issues with the governments,” said a member in the panel.