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Lack of price relief tarnishing govt image: AP to Centre
The Andhra Pradesh government conveyed to the Centre that there was no corresponding fall in prices of the goods though there was reduction in rates of tax on several goods under GST. This was creating a ‘bad image’ about the government in the eyes of public.
Amaravati: The Andhra Pradesh government conveyed to the Centre that there was no corresponding fall in prices of the goods though there was reduction in rates of tax on several goods under GST. This was creating a ‘bad image’ about the government in the eyes of public.
Finance minister Yanamala Ramakrishnudu wrote a letter to Union Finance Minister and chairman of GST Council Arun Jaitley on Thursday reiterating some important issues which he had raised in the last GST council meeting in Hyderabad. However, Yanamala specially expressed concerned over the fact that there was no corresponding fall in prices of the goods though there was reduction in rates of tax on several goods under GST.
He stressed the need to evolve a robust price control mechanism at the Government of India level to control prices in open market. “The non-reduction in prices of goods is reflecting badly on the government among public,” he said. He also requested reduction or exemption in rate of tax on certain goods and services used by lower income group people.
Ramakrishnudu also said the compliance burden on small traders and businessmen under the GST was very high compared with the pre-GST regime as they have to file GSTR1 GSTR2 and GSTR3 returns every month. Further, he said the liability of pay tax under reverse charge mechanism was also a burden on those small traders. He suggested that the Centre may keep this on hold for a period of one year.
Reiterating the need for reduction of GST rates on work contract services executed for the government by the contractors, Yanamala said though the GST Council reduced the tax to 12 per cent on work contracts, the GST rate on sub-contractors to these main contractors remained at 18 per cent. “As a result, the intended benefit to the state governments are not being realised as these works are mainly executed by sub-contractors and they are required to pay GST at 18 per cent rate,” he said. He requested the Arun Jaitley that the GST rate may be reduced to 12 per cent for the sub-contractors who execute government works on behalf of main contractors.
Yanamala said he had also raised the issue of finances of Andhra Pradesh, which was in critical situation. He wanted the Centre that the revenue figures of SGST, CGST and IGST and Cess paid, relating not only to AP state, but also of all other states, be made available on real-time basis on GST portal.
The finance minister again requested the Centre to give exemption or reduce the rate of tax on certain goods such as tamarind, honey, coffee, turmeric, soaps, tamarind soapnuts, sheekakai shampoos, bio-diesel, dry fish, fishnets and fishnet fabrics. He also listed some other items, including granite slabs, napa tiles, cotton yarn in hanks, tractors, hybrid cars and some other goods.
