Save fiscal autonomy of states in GST Regime: Deve Gowda to PM

The states had agreed to GST, relinquishing their exclusive constitutional right to tax goods: Gowda

JDS supremo H D Deve Gowda said, on Sunday, any effort to "restrict empowerment or cross empowerment" to states in administering tax on services in the GST regime will amount to the Centre going back on its earlier assurances and endanger the principles of federalism and fiscal autonomy of the states.

"Any attempt to restrict empowerment or cross empowerment to the states in administering tax on services on any reason will amount to the Centre going back on its earlier assurances and endanger the principles of federalism, as well as fiscal autonomy of the states," he said in a letter to Prime Minister Narendra Modi.

The former prime minister opined that the spirit of GST and the principles of federalism should go hand in hand without any violation or favouritism.

Gowda said the states had agreed to GST, relinquishing their exclusive constitutional right to tax goods.

"In reciprocation, the power to tax services on a mutually agreed and respectable ratio was assured to the states by the Central Empowered Committee of State Finance Ministers, which paved the way for passing of the GST Bill in the states," Gowda said.

He said that he is against GST Council's attempt to reserve a large portion of empowerment to the Central Excise Department at the cost of Commercial Tax Departments of states.

Gowda said that he has been watching developments relating to strikes and protests by officers and employees of commercial tax departments of various states "against the GST Council's attempt to reserve a large portion of empowerment to the Central Excise department at the cost of the commercial tax departments of the States."

Entrusting a larger responsibility in administration of GST to states is the only way to protect expanding avenues of revenue, badly needed for state welfare and infrastructural programs, he opined.