Govt plans Rs 4,000-crore overhaul of 80 check posts for GST

Road Transport and Highways Ministry is considering a Rs 4,000 crore overhaul of around 80 border check posts across the country to ensure seamless flow of goods ahead of the implementation of GST.

An app to link check posts under state governments as well as the Centre is also in the works, the government has said.

"The Ministry would be one of the the biggest contributors towards the GST regime. There are check posts under the state government as well as the Central government. We are going to link them and are developing an app for it," Road Transport and Highways Minster Nitin Gadkari told PTI.

The government is keen to implement the biggest tax reform since Independence from April 1 next year and the Goods and Services Tax (GST) aims to iron out a multi-layered indirect tax system, subsume all other indirect taxes and usher in an uniform tax structure. It was conceptualised in 2006 under the United Progressive Alliance-1 government.

The Minister said that once the GST is rolled out, it will facilitate the inter-state movement of goods and therefore, the need has been felt to augment border check posts.

State border check posts, which scrutinise material and location-based tax compliance, often stretch the transit time of goods by hours.

"The Road Transport and Highways Ministry has decided that complementary activities should happen for GST implementation. It has identified 80 inter-state check points pan-India to be augmented for smooth flow of goods," an official said.

The official said an estimated Rs 50 crore is likely to be spent on each such check post.

Citing an example, the official said, "Cargo vehicles including trucks and lorries at present prefer reaching Bangalore from Delhi via Rajasthan despite it being a longer route as Delhi-Bangalore, despite being shorter, has many check posts which delay cargo."

Long queues of lorries and trucks can be seen at various check posts by forest department and various other government departments including border posts.

These unproductive transit hours, as well as regulatory hurdles, delay overall manufacturing and trade.

However, a unified tax and regulatory environment under the GST would help improve the delivery process and cut down on transport hassles. It is projected that there will be a substantial reduction in distribution costs of 10-15 per cent, thus reducing the final price of goods.

Government has formally notified the GST Council, which will decide on the tax rate, exempted goods and the threshold under the new taxation regime.