Mumbai: The Maharashtra government on Wednesday issued a government resolution (GR) that the extra burden the contractors are incurring on account of the Goods and Services Tax (GST) shall be compensated by the Public Works Department (PWD).
The move comes days after the contractors threatened to stop work.
The Maharashtra Government Contractor Association, an umbrella body of contractors, had held a meeting with PWD Minister Chandrakant Patil and Finance Minister Sudhir Munguntiwar a few weeks ago.
“We are facing trouble since we had filed tenders before the implementation of the GST and had paid all the prevalent taxes. Now, we are being charged extra,” said Milind Bhosle, an engineer and president of the association.
“Extra burden shall be compensated upon production of authenticated records (after deducting VAT and/or excise as in earlier contracts),” said the GR issued on September 19.
The state will be forming a state schedule of rates (SSR) committee to decide on the government-approved rates of items required for construction, excluding GST.
“GST shall be added as per the prevailing rates in the recapitulation sheet of the estimate prepared based on the SSR,” said the GR.
The committee will prepare the SSR and get approval of the government latest by April 30 and it will come into effect on June 1 of every year.
