Reduced CST to cause Rs 3,000-cr loss to Haryana
Haryana minister for excise and taxation, Kiran Choudhry, on Saturday said that due to reduction in central sales tax (CST), Haryana could suffer revenue loss of over Rs 3,000 crore in the coming fiscal year.
Choudhry, who was speaking at a meeting of the empowered committee of finance ministers in New Delhi, urged the committee to take up the matter with the Centre to increase the rate of CST back from 2% to 4% or 5 % so the state was not put to financial hardships.
She said that there was an agreement to reduce CST from 4% to zero and to introduce goods and service tax (GST) in three years and also that the states were to be compensated for the loss in CST revenue by the Centre.
During the last financial year 2010-11, Haryana had a loss of Rs 2,624.7 crore of revenue due to reduction in CST rate from 4 % to 2 %, out of which only Rs 1,136.16 had been compensated, she said.
Choudhry, who said that other states also had similar complaints, regretted that the Centre had now decided that states would no longer be compensated for the reduced CST collections.