Oppn-ruled states hope to defer GST rollout by two months, cite ‘discrepancies’

There has been hectic lobbying by states and industry bodies for concessions ever since the tax rates for most goods and services were fixed.

West Bengal and a few other Opposition-ruled states plan to defer the rollout of the Goods and Services Tax (GST) by at least two months, citing “discrepancies” in the tax structure and non-framing of rules.

Finance minister Arun Jaitley said the government will implement the new tax regime from July 1. West Bengal chief minister Mamata Banerjee believes it should not happen before September. (Mohd Zakir/HT Photo)

Opposition parties expressed their intention a day after finance minister Arun Jaitley revealed that the government will implement the new tax regime from July 1. The demand will be raised at the GST council meeting on Saturday.

The ruling Trinamool Congress party in the eastern state believes that the GST must not be rolled out before September, and the other Opposition parties agree. “Bengal finance minister Amit Mitra contacted many Opposition leaders to garner support for a delay. There are genuine concerns,” said a senior Congress strategist.

There has been hectic lobbying by states and industry bodies for concessions ever since the tax rates for most goods and services were fixed. This spurred Jaitley to say that “using media propaganda for getting rates varied will not have a significant impact on the council’s decision”. News agency PTI quoted revenue secretary Hasmukh Adhia as saying that there was scope for rationalising tax rates because the government’s intention was to increase revenue without hiking tax rates.

The Opposition wants changes in the tax structure of some goods. “According to the current proposal, wigs will attract 5% tax. However, any value-addition to the wigs will attract 28% tax. Is this rational?” a Congress leader asked.

Mitra, for his part, said the West Bengal government was not alone in objecting to the GST in its present form. “Many industrial sectors – such as manufacturing and services – have also raised serious objections,” he added.

The Opposition will also demand rate concessions on single-screen theatres, vernacular movies and shoes priced below Rs 500 because these categories have a potential for employment generation. “I will highlight that there are major objections from different sectors to the June 1 rollout of the GST. The services sector is against it,” Mitra said.

The 15th council meeting on June 3 will give finishing touches to the GST by finalising rates on shoes, beedis, jewellery and biscuits. The participants are also expected to discuss the transition rules.