With Goods and Services Tax set for rollout from July 1, an enigmatic situation has arisen as to who would control taxpayers – Central Excise and Service Tax officials or Commercial Tax officials of the State government.
There has been a ‘tug of war’ between the officials of the two governments to gain control over maximum number of assessees under GST regime.
In a statement issued here on Wednesday, Tamil Nadu Chamber of Commerce senior president S. Rethinavelu and president N. Jagatheesan appealed to the authorities concerned to sort out the issue at the earliest. They said there would be no change in the amount of revenue to be obtained by the Central and State governments as the entire revenue from State Goods and Services Tax (SGST) would go to the respective States and the revenue from Central Goods and Services Tax (CGST) to the Central government.
As for controlling the assessees, the GST Council had recommended that 90% of GST tax payers with up to ₹1.5 crore turnover would be assessed by the State, while the others would be assessed by the Centre.
For those with turnover exceeding ₹1.5 crore, the assessment would be done on a 50:50 basis between the Centre and States.
The Chamber has strongly opposed the division of assessees without any sustainable and justifiable basis and short of any consultation with the GST tax payers. It was an affront on the taxpayers. If the split was made on the basis of turnover, taxpayers might face jurisdictional complexity as far as assessing authority was concerned since every year there might be an increase or decrease in turnover.
The GST Council should have confidence in enforcing officials – whether Central or State – that they would effectively assess whether the tax was against supply of goods or services provided by the assessees.
To overcome such problems that would be faced by taxpayers, the assessees should be given the option to decide on coming under the jurisdiction of the Central tax authority or the respective State government tax authority depending upon factors like their past experience with tax authorities, comfortability, better ambience, nature of business and quantum of intra, inter-State and export turnover and whether they were manufacturers, traders or service providers.
Providing such an option to taxpayers would create a healthy competition between the two sets of tax enforcing officials, they said.
