Centre wants to take away state's autonomy through GST: Patel

Taking a dig at the union government over the Goods and Services Tax (GST) Saurabh Patel, minister of state for finance and industries, government of Gujarat on Friday alleged that the congress-led UPA government is trying to take away the economic power from the state governments.

In his address to the state assembly on Friday, Patel alleged that the union government was trying to snatch away the autonomy of the states. "The amendments put forward by the central government in the GST bill would take away autonomy of the states. VAT would no longer be the state subject. The parliament will get all the power to decide on the exemptions and tax rates," Patel said adding that the largest share of the state revenues came from the Value Added Tax (VAT).

"There are goods that are put under the 4-5 per cent of VAT rates at present, but the GST roll-out would increase the rate on these goods upto 12 per cent. This will make some of the essential food commodities costlier. The proposed amendments in the GST bill is aimed at benefitting big industrialists, while small units from Gujarat will take a beating," Patel added.

Informing the house, the minister told that as per 2009-10 estimates, the possible loss to the state exchequer due to GST roll-out was estimated at Rs 3,120 crore, while nationally, the all states could face a loss of around Rs 31,000 crore. After a revision made for 2010-11, the possible loss to the state was estimated at minimum Rs 5,000 crore, Patel informed.

Gujarat and several other states have objected to the amendments in the GST bill and rejected the implementation unless it was revised.