State worried over GST roll out

The Centre may be eager to introduce the proposed Goods and Service Tax (GST) from April 1, 2010, but the Orissa government has cast doubts on the timely launch of the new tax regime.

Prafulla Chandra Ghadei, the state finance minister said, “I don't think the GST can be introduced as per its schedule from April 1, 2010. A lot of ground work needs to be done before we can think of introducing the new tax regime. The Constitution has to be amended and a lot of awareness campaigns have to be arranged to make different stakeholders aware about GST.”

“We cannot think of switching over to GST at a time when the VAT regime is yet to be stabilized in Orissa. Around 50 per cent of the traders in the state do not file their returns and this is a cause of concern”, he added.

Ghadei was speaking at a workshop on Introduction of GST, organized by the Federation of All Orissa Traders Association (FAOTA).

The Empowered Committee of state finance ministers is scheduled to meet very soon to discuss the modalities of introduction of GST. Though the Centre aimed to introduce GST from April 1, 2010, states like Gujarat and Madhya Pradesh want it should be delayed.

The proposed indirect tax regime would replace most of the indirect taxes levied by the Centre like excise and service tax and subsume state-levied taxes like value added tax (VAT).

Speaking on the occasion, NB Dhal, commissioner (commercial taxes), Orissa said, “Under the GST regime, all inter-state dealers have to work on IT platforms as all the inter-state transactions will be fully computerized. To facilitate the introduction of GST in Orissa, we need to strengthen our IT infrastructure and also provide the requisite training to the concerned officers.” Dhal pointed out that the state government had embarked upon a plan to modernize the check gates for the convenience of the traders. “We would study the functioning of the inter-state check gates in Gujarat and would try to replicate the model in our state”, said Dhal. Pyari Mohan Mohapatra, the Rajya Sabha MP said, “There needs to be mutual understanding between the state government and the traders. The traders need to understand that it is not the objective of the state government to harass them.”

Sarat Sahoo, president, Orissa Industries Federation said, “The public distribution system in the state needs to be made online for the benefit of the traders and the consumers. Such a move has been already been implemented by the states of Gujarat and West Bengal.