Central indirect tax officers seek redressal of flaws in GST’s final design
CBEC officers write to PM Narendra Modi to reiterate concerns over the formula for sharing of administrative powers with states under GST

Remya Nair

CBEC officers pointed out that the sharing of administrative powers with states could lead to loss of revenues for the central government to the tune of Rs1.1 trillion.

The representative body of central indirect tax officers has written to Prime Minister Narendra Modi flagging concerns over the agreements reached with the states on the final design of the goods and services tax (GST).

In a letter written by the Indian Revenue Service Association dated 21 February, officers of central board of excise and customs (CBEC) have reiterated concerns over the formula for sharing of administrative powers with states wherein 90% of the taxpayers with an annual revenue threshold of less than Rs1.5 crore will be under states’ control. They pointed out that this could lead to loss of revenues for the central government to the tune of Rs1.1 trillion as the sharing formula will leave only 18% of the taxpayers under the control of the centre.

They have also demanded that the recommendations of the GST council should not be treated as binding on the Union government.

Further, the letter states that the delegation of powers to the states under the integrated GST act will mean delegation of powers without any accountability as the action of the states will be outside the purview of the Comptroller and Auditor General of India (CAG) and the Public Accounts Committee (PAC). They also sought brining in a state officer administering a central act and central levy under the jurisdiction of the Central Bureau of Investigation (CBI).

They have opposed the provisions in the draft GST law which permit revision of orders passed by the tax authorities even after 5 years, allows checking of vehicles in transit and the need for service providers to register in every state of their operations arguing that this will impact the ease of doing business. They have also sought the revamp of the dispute resolution mechanism.

Officers have also sought transferring the goods and services tax network (GSTN)—the information technology backbone of GST—to CBEC.

Remya Nair
Source : livemint