Allaying apprehensions on the Goods and Services Tax, Finance Minister Yanamala Ramakrishnudu on Wednesday said there was no need to postpone the implementation of the tax regime.
Addressing a press conference at the Secretariat, Mr. Ramakrishnudu said there was a demand that the GST be postponed until the challenges involved in its implementation were addressed. There could be teething troubles but it would actually lead to expansion of the assessee base and taxpayer base. The GST Council would meet every month and take stock of the situation. The problems if any could be sorted out at the meet, he said.
The teething problems should not be seen as challenges and impediments if the objective of the reform were to be considered. It was not the first time that the tax reforms were introduced. The nation migrated to the Value Added Tax (VAT) previously. Now, the GST was another major tax reforms, he said.
Mr. Ramakrishnudu said the States should avoid incentive spree approach, which eventually would strain the finances. It would compel the States to depend on compensation from the Centre for which they would have to collect cess from the public, he said.
To a question, the Minister said manufacturing States such as Tamil Nadu were likely to lose their portion of revenues from inter-State sales and the consuming States like Andhra Pradesh would stand to gain.
To another question, he said the liquor and petroleum products would be brought under the GST purview. As both were major sources of revenues for many States, they were deliberately kept outside the GST. The governments were likely to crumble if there was a sudden dip in their revenue, he said.
