Meghalaya CM terms GST as ‘Gabbar Singh Tax’; Questions NDA govt for complex tax policy


Shillong, November 22, 2017: Chief Minister Mukul Sangma has said the collection of revenue under the Goods and Services Tax (GST) regime in Meghalaya could not be assessed properly due to the incapability of the system being put in place. Sangma, who is heading the Congress-led government, lashed out at the National Democratic Alliance (NDA) government for not allowing the input tax credit for building infrastructure like hotels in the tourism sector whereas it has been allowed for all other infrastructure.

On Tuesday, the Meghalaya cabinet was briefed on the revenue collection realization by various departments under the new tax regime. "Subsequent to rolling out of the new tax regime, the number of tax payers registered under GST is only 9,546 of the 25,852 registered earlier under the old tax regime Value Added Tax (VAT), besides another 5,752 new tax payers who have registered under the GST," Sangma told journalists on Tuesday night. The Chief Minister said only 40 per cent of the tax payers have been able to file tax returns because of the incompetence of the system being put in place. "All these registered tax payers under GST have to file their returns. Instead of all tax payers file their returns they are facing a lot of problems due to the incompetence of the system being put in place. That is why we are yet to know whether our revenue realization is on expected lines or not," Sangma said. Noting that the state was expecting much more realisation of revenue than the projected 14 to 15 per cent, he said the revenue collection could not be assessed because of the incapability of the system that should ensure smooth implementation of GST.

Accusing the Bharatiya Janata Party-led NDA government of targeting big investors by not allowing input tax credit (ITC) in the tourism sector while implementing GST, Sangma demanded clarity on this. "We need a complete clarity on this, why is it like this, are they targeting someone who is investing huge amount of money in hospitality sector or not that I want to know," he said. "I will be writing as we need clarity on this abnormal approach. The implementation of GST is considered to be something which will be genuine simple tax, and not like a Gabbar Singh tax by targeting some hoteliers," Sangma said. Moreover, he said the central government's decision not to allow ITC in the tourism sector will discourage people from investing in the tourism sector. "It is quite a paradox as Centre has lot of schemes to promote tourism," the Chief Minister said. Sangma said the Meghalaya cabinet has directed that the issue be taken up at the GST Council level again. "The whole issue will be taken up at the political level by the chief minister and I will also write to other counterparts," he said.