'Gujarat want clarity on GST impact on income'

At a meeting with the union finance minister, P Chidambaram, states asked for more clarity on the issues pertaining to rollout of goods and service tax (GST). The meeting was held in New Delhi on February 14.

“We discussed two main agendas on CST compensation to states and bringing the constitutional amendment. Most states have raised concern about some of the issues pertaining to the rollout of GST,” said Saurabh Patel, minister for energy and petrochemicals, government of Gujarat. He maintained that states had asked for clarity on the issues of states’ income, tax structure, computerization etc. “Before bringing constitutional amendment Centre should bring clarity on the issues such as impact on the income of the states. How the tax structure will be, which businesses to benefit and most importantly, computerization of tax filing,” said Patel, who was present at the meeting with the finance minister.

On the central sales tax (CST) compensation, Patel informed that all the states have demanded 100 per cent compensation of CST loss for the year 2010-11, 75 per cent for 2011-12, and 50 per cent for 2012-13.

“We hope that in coming budget, the finance minister would make necessary provisions for CST compensation to the states. CST compensation is the right of the states and most states believe that the Centre has acted against the prescribed rules by not giving CST compensation for past three years,” he said on the sidelines of an industry fair here on Friday.

It may be noted that earlier at a meeting of central empower committee in Bhuvaneshwar last month, the Centre had agreed to give 75 per cent CST compensation for 2010-11, 50 per cent for 2011-12 and no compensation for 2012-13.