GST: State to oppose Centre’s move

Balagopal says Kerala will seek extension of shortfall compensation

Finance Minister K.N. Balagopal has said that the State will oppose the Centre’s move to bring natural gas and molasses used for captive consumption under the Goods and Service Tax (GST) regime.

“The issue had figured in the GST Council. Already, many States have come out against the move and it will be opposed as the proposal is detrimental to the States,” Mr. Balagopal said during a meet-the-press programme here on Tuesday.

The Finance Minister said the State would also press for an extension of the GST shortfall compensation for another five years in view of the economic crisis driven by the pandemic, and the dip in revenue and rise in expenses.

The States were looking for more financial assistance from the Centre to tide over the crisis and to revive the economy. But, the Centre was trying to bring all taxes under it in the GST regime.

Petrol/diesel

To a query, Mr. Balagopal said he could not support the move to bring petrol and high-speed diesel under GST. Many States had a higher tax for petrol and diesel than in Kerala. Under the GST regime, the State could fix taxes for petroleum products and alcohol alone.

Retirement age

The Finance Minister denied any move to raise the retirement age of State government employees and teachers. “It is one way to stabilise the financial position of the State that is facing acute crisis. We have no plan to increase the retirement age.” The government is looking into the report of the committee on statutory pension.

The government is for collecting the tax arrears and taking stern steps against those evading tax. “Many are willingly giving money for charity, but are reluctant to pay taxes to the government,” he said. The government would seek the cooperation of traders and the business community in improving tax collection, he said.

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