Hyderabad: Providing partial relief to Telangana State, the GST Council on Saturday agreed to reduce the GST on public works including major irrigation projects, Mission Bhagiratha and Mission Kakatiya, from 18 per cent to 12 per cent. The revised GST will be applicable on the projects to be taken up by the government in future. Union Finance Minister Arun Jaitley also assured to look into a strong appeal made by the State government for restricting the GST to 5 per cent with regard to the ongoing projects for which budgetary allocations have been already made.
IT and Industries Minister KT Rama Rao who represented the State made a strong pitch for total waiver of GST on the public utility works and welfare programmes which received strong support from different states including Punjab, Rajasthan, Jharkhand, Gujarat, and West Bengal. Responding positively, Jaitley has assured to call for reports from the departments concerned to examine the feasibility for considering the plea.
Speaking to reporters, the IT and Industries Minister said that unless the tax rates are reduced, the State government will have to bear additional burden of over Rs 19,200 crore due to works worth over Rs 1 lakh crore taken up in irrigation sector including Mission Bhagiratha and Mission Kakatiya. Another Rs 18,000 crores worth works are taken up in housing sector and Rs 30,000 crore works in the departments of Municipal Administration, Roads and Buildings, and Panchayat Raj. He said that if the Centre fails to consider the just requests of Telangana State, the government would not hesitate to take legal course.
Rama Rao stated that the revised taxation would provide partial relief. He also pitched for reducing tax against textiles from 18 per cent to 5 per cent as it is one of the largest job providers in the State. He made a strong case for reducing high tax rates against beedi and granite industries which are providing employment for lakhs of people in the State. “The Union Finance Minister has assured to examine the possibilities. We would continue to pursue these issues in the next GST Council meeting scheduled to be held in Hyderabad on September 9,” he said.