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Capt offers PM ‘101 ways’ to simplify GST ‘Coal-Based Plants Being Preferred’

June 01, 2019 06:09 AM


Capt offers PM ‘101 ways’ to simplify GST
‘Coal-Based Plants Being Preferred’


To help the state narrow its deficit by improving the Good and Service Tax (GST) collection, Punjab chief minister Amarinder Singh has suggested to Prime Minister Narendra Modi that the State GST rate should be higher than the Central GST.

Pointing to the problems being faced by businesses community, Captain Amarinder on Friday wrote a letter to Modi giving 101 suggestions for plugging the gaps in GST. The CM suggested bringing an amnesty scheme to overcome the various aberrations that led to confusion in the business community in the initial phase of GST.

Captain Amarinder also suggested widening the GST net to include electricity, real estate and petroleum to make it a “winwin situation for states as well as businesses”. Noting that electricity constituted up to 30% of the cost of production in many key sectors and its exclusion from GST results in huge cascading of up to 10%, the CM pointed out that the present structure prefers coal-based polluting captive power plants of big industries over stand-alone power plants (many using natural gas) from where MSMEs source their power.

In the letter, he stated that exclusion of products like crude and natural gas from GST resulted in a situation where it was beneficial to export them and re-import rather than supply them directly within India. Many states like Punjab lose substantial revenue as the embedded taxes on these products were retained at source rather than at the place of consumption, he pointed out.

Many other suggestions that would, he claimed, help to boost exports or provide level playing field to Indian industry vis-à-vis foreign counterparts had also been made.

Besides addressing structural issues, penal matters, revenue enhancement as well as tax rates and exports and imports, the proposals include initiatives for simplification of the tax regime, issues relating to supply, input tax credits, and valuation.

With increasing reliance on technology, Captain Amarinder had given various suggestions that should help move towards easy automation of processes and even a driverless environment in GST compliances based on algorithms.


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