Come July 1 when the GST is rolled out, the flagship programmes of the State government are set for a huge cost escalation but officials do not hazard a guess as they reserved the estimates till the payment on manufacturing goods was met in subsequent days.
However, the government has made a rough estimate that the escalation could be ₹2,000 crore in the Mission Bhagiratha, which is meant to supply drinking water to all households.
The Mission Bhagiratha, Mission Kakatiya and double bedroom housing for poor, which stand out as prestigious programmes of the government, were taken to the notice of the Centre with a request to exempt them from GST but there was no response.
In the case of Mission Bhagiratha and Kakatiya, the Centre had notified that any material procured for drinking water and irrigation would be exempted from Central Excise. There was a 12.5% Central Excise duty on pipes and other equipment which has become zero after the notification but the purchases have not been granted exemption from GST now. As a result, the government will pay GST at the rate of 18% (VAT of 5% is subsumed in it).
