Supreme Court ruling on GST will settle tax-sharing row: TS

Hyderabad: The Supreme Court ruling that the Union government and States have equal and co-ordinate power to legislate on matters of Goods and Services Tax (GST) has come as a surprise to the Telangana government.

The State authorities are confident that the issue of tax sharing between the State and Centre and the freedom of finalising the tax structure by the State government will be resolved now. The State government has been demanding the Union government for more share in GST and had raised objections on the increase of GST on textiles and handlooms from 5 per cent to 12 per cent. The State governments are asking the Centre to give them freedom to decide the GST amount on certain goods which are linked to the local conditions. If the Centre has full powers in deciding the GST structure, the States will have to struggle a lot to overcome the economic hurdles, officials feel.

The State government is waiting for the Apex court's order copy so that it could analyse and know what it means to the State in terms of State's role in deciding GST rates. Some feel that since GST Act was enacted by Parliament, it requires a majority support in the Lok Sabha to amend it, the officials said.