The State government of Kerala will start levying 1% flood cess on goods and services transacted within the State from August 1.
The proceeds from the cess will be used for funding the post-flood rebuilding projects. The GST Council had permitted the government to levy 1% cess on goods and services within the State to mobilise resources for rebuilding the State.
The cess has not been imposed on goods and services that figure in the tax slabs below 5%. Traders who have opted for composition tax also have been excluded from the cess.
Oppn. flays decision
Leader of the Opposition Ramesh Chennithala said in a release on July 31 that the decision to levy the cess ignoring public protests was a challenge to the people. Mr. Chennithala said it amounted to a double punishment for the people who could not still come out of the ravages wreaked by the flood.
The cess would trigger inflation and impose an additional burden of ₹1,200 crore on the people. Already, the State government had imposed a burden of ₹1,785 crore through the budget. All these come in addition to the ₹1 each additional cess and excise duty on petrol slammed by the Centre, he said.
