GoM to review cess proposal for Kerala flood victims

Finance Minister Arun Jaitley, who chaired the 30th Goods and Services Tax (GST) council meeting on Friday, approved creation of a seven-member Group of Ministers (GoM) to review the cess proposal for rehabilitation of Kerala flood victims.

Addressing reporters after the meeting, Jaitley said that the GoM will have representatives of the North-East, hill and coastal states. "We are making a seven-member group of ministers which will discuss the Kerala cess proposal. This committee will have members of North East, hill and coastal states. The committee members will be announced soon. We will make recommendations within the next few weeks," he said.

The special cess, if implemented, will help in raising additional resources to meet the reconstruction cost in the state of Kerala which recently suffered its worst deluge in almost a century. The floods claimed lives of more than 400 people and caused damage to the tune of nearly Rs. 20,000 crore.

Jaitley added, "Bihar imposed additional Value Added Tax (VAT) in 2015-16 when tax reduced due to the prohibition of alcohol. Taxation inflated by 27 per cent as compared to the previous year. Bihar was benefited from this aberration."

The Finance Minister also reviewed the revenue position of the north-eastern states and said that there was no shortfall.

"Detailed presentation took place about revenue position. It had been decided earlier that GST council secretary will visit revenue deficit states and analyse it. It was found that there was no revenue shortfall in consuming north-eastern states."

Responding to a question on whether petroleum would be brought under the ambit of GST, Jaitley said the issue was not discussed during the meeting.

Fuel prices in the country have been witnessing a steep rise since the past few weeks. While the Opposition has repeatedly blamed the union government for not doing enough to keep a check on prices, the central government has maintained that global crude oil prices and other international factors are causing a hike in prices of petroleum products.

Last week, Union Petroleum and Natural Gas Minister Dharmendra Pradhan had said that petrol and diesel commodities should come under GST category.