KCR delays GST letter

Hyderabad: The state government on Sunday deferred its decision to write a letter to the Centre opposing levying of 12 per cent GST on the ongoing projects such as drinking water schemes, irrigation projects and laying of roads.

According to the Chief Minister’s Office, the government has embarked upon a detailed exercise to work out the exact figures pertaining to the additional burden on the government due to the GST that came into effect a month ago. Chief Minister K Chandrashekar Rao on Sunday convened a meeting of senior officials, including Chief Secretary S P Singh, and discussed the issue.

Genco chairman D Prabhakar Rao, Special Chief Secretary S K Joshi, Advisor to the Government G R Reddy, senior IAS officers Somesh Kumar, Shiv Shankar, Santa Kumari, Anil Kumar, Sandeep Sultania, Sunil Sharma, GHMC commissioner Janardhan Reddy, etc were present in the meeting.

The Chief Minister directed the officials to come out with detailed reports on Monday explaining how the project cost was arrived at based on 5 per cent VAT and how it would be difficult to alter the project costs at this stage since the budgetary allocations have already been made.

KCR has also told them that the reports should have exact and minute details about the amount of works that have already been completed with regard to each project and what would be the exact quantum of additional burden on the state exchequer if they have to be taken up as per 12 per cent GST.

The prospective letter would make it clear to the Centre how it would be impossible for any government -- whether it is Telangana or any other state -- to bear such huge financial burden. The Chief Minister said the state government had always strongly argued against imposing the GST on ongoing projects of public utility and even on Saturday it forcefully reiterated the same.

It was because of such strong argument the Centre had reduced the GST on projects from 18 to 12 per cent. But still the Telangana government is not satisfied, he said. KCR told the officials that works on irrigation projects like Kaleswaram, Palamuru, Sitarama Lift Irrigation Project, Mission Bhagiratha and ongoing housing projects as well as power projects like Yadadri and Bhadradri were taken up about two years back.

The Phase-1 of Mission Bhagiratha was launched by Prime Minister Narendra Modi himself, he said. The Chief Minister said some projects were taken up with external funding and now the agreements with those agencies cannot be changed.

Hence, he said before knocking on the doors of the court, the state government should make a powerful plea with the Centre based on impeccable details of the burden the state would have to bear. If the Centre refuses to consider the request, then they should approach the court, KCR told the officials.