GST on petroleum products only after revenue stabilises: Sushil Modi
Kolkata, Aug 2: Bihar Deputy Chief Minister and GST Council's member Sushil Modi on Thursday said the Council can think of bringing the petroleum products under the new tax regime only after the monthly revenue target of Rs 1 lakh crore is achieved.
He said there could be a "shortfall in revenue" in initial months as indirect tax rates on items are being lowered, but the revenue would increase in the long run due to more compliance.
Modi said the new indirect tax structure would be a "complete GST" only after petroleum products, stamp and electricity duty are included.
He also said the way the GST is being "implemented successfully", "no states would be required any compensation after three years".
"When you reduce the tax rates, there may be a shortfall in revenue for the next 3-4 months and sales remain comparatively lower during the monsoon season. But, in the long run, the revenue will gain because lowering the rates will lead to more compliance and people have a tendency to pay taxes when it is low. There will be better revenues as tax rates for more than 450 items were brought down," he said.
In a relief for common man, the GST Council in its last meeting reduced tax rates on over 50 items including refrigerators, washing machines and small televisions, which would now be taxed at 18 per cent, down from the current 28 per cent.
"Our target is to get Rs 1 lakh crore per month," he said on the sidelines of an event organised by the Indirect Tax Committee of the Institute of Chartered Accountants of India.
Modi said there is "no guarantee" that the prices of petroleum products would come down if they are brought in the GST ambit.
"No states would like to reduce revenue as they are earning 40 per cent of their revenue from petroleum products. Even if these products are brought under GST, the states will also be allowed to levy taxes over and above the GST rate as these are considered as sin goods," he said.
Elaborating further, he said: "Let the revenue stabilise. When we achieve the Rs 1 lakh crore (monthly) target, then only the GST Council can think of bringing petroleum products under GST. I do not see inclusion of these products in the tax regime in near future and it will take longer time, but ultimately, stamp duty, electricity duty and petroleum products have to come in GST."
He also indicated that the GST Council's efforts would continue to bring more items, except some sin and luxury goods, from the 28 per cent slab and there is a possibility to create a new slab between 12 per cent and 18 per cent depending on the stabilisation of revenue.
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Dy CM Shivakumar confident of Congress win in Karnataka bypolls
Bengaluru (PTI): Karnataka Deputy Chief Minister D K Shivakumar on Saturday expressed confidence that the ruling Congress will secure a decisive victory in the Assembly bypolls scheduled for April 9 in the Bagalkote and Davanagere South constituencies, citing a favourable ground response to the party’s guarantee schemes.
These are ‘Shakti’, ‘Gruha Lakshmi’, ‘Gruha Jyoti’, ‘Yuva Nidhi’ and ‘Anna Bhagya’.
The bypolls were necessitated by the demise of sitting Congress MLAs Shamanur Shivashankarappa and H Y Meti, who represented Davanagere South and Bagalkote constituencies, respectively.
The Congress has fielded Shivashankarappa’s grandson, Samarth Shamanur, in Davanagere South and Umesh Meti in Bagalkote. They are locked in direct contests with BJP candidates T Dasakariyappa and Veerabhadrayya Charantimath.
“Both Bagalkote and Davanagere are very positive. Congress workers are doing an excellent job, going door to door and convincing people about the guarantee schemes,” Shivakumar told reporters here.
He said even voters who had earlier supported the BJP were now inclined towards the Congress.
“Even those who voted for the BJP earlier are saying they will vote for Congress. People want the guarantees to continue and are expressing difficulties due to rising prices,” he said.
Expressing confidence of an improved electoral performance, he added, “There is a strong sense that we will win with a bigger margin than before.”
Shivakumar also said he would travel to Kerala for two days and resume campaigning thereafter. “I am going to Kerala for two days. After returning, we will continue the campaign from Davanagere,” he said.
Referring to the shortage of LPG, including auto LPG, in the state, Shivakumar blamed the BJP-led government and called for immediate intervention by the Centre.
“The LPG shortage is due to the BJP. Auto drivers and those in the transport sector are facing difficulties,” he claimed.
“This is something the central government has to address. It must formulate proper policies and take precautionary measures,” he said, adding that the BJP should apologise to the public.
“They should come forward and apologise to the people for the inconvenience caused and resolve the issues they have created,” he said.
