GST Effect: Telangana tax collection goes to a new low

 Telangana | Written by : Suryaa Desk Updated: Sun, Jan 21, 2018, 03:12 PM

Hyderabad: Finance minister Etala Rajender on Saturday said that GST had dealt a severe blow to Telangana state. He said the tax collections had taken a hit.

“After GST came into force, the Telangana state government had to subsume 48 per cent of  taxes. The GST was expected to increase the tax base and taxation, but it proved  otherwise in reality. The Centre said the tax base of dealers would double, but this has not happened,” Mr Rajender told the general body meeting of the All-India Association of Central Excise Gazetted Executive Officers, here.

He added, “Prior to GST, the tax collection growth rate of Telangana was 21.9 per cent, which came down to less than 14 per cent now. The fact that  a revenue-surplus state like Telangana is getting compensation like other revenue deficit states shows how our taxes have taken a hit in the GST regime.”

Mr Rajender stated that TS was supposed to get Rs 450 crore GST compensation, but the Centre had paid Rs 250 crore, saying the government was yet to collect GST arrears, which is illogical.

He said the state had lost the power to either increase taxes or mobilise an additional Rs 10,000 crore through under GST.

“For that reason, I oppose bringing major reforms back to back. Demonetisation and GST were enforced within a short span leaving no breathing space for either state governments or  people. The negative impact of those hasty reforms are here for all to see,” Mr Rajender said.