CST compensation is given to states for the revenue loss they suffer on account of the gradual reduction of the rate of this levy from 4% to 2% as a prelude to introduction of the GST.
A parliamentary panel that reviewed the government’s tax revenue streams and spending patterns has slammed the Centre for not disbursing to states the promised central sales tax (CST) compensation it had earmarked in the three annual Budgets leading to 2013-14. CST compensation is given to states for the revenue loss they suffer on account of the gradual reduction of the rate of this levy from 4% to 2% as a prelude to introduction of the Goods and Service Tax (GST).
The standing committee on finance led by Congress leader Veerappa Moily said the routine explanations given by the finance ministry for not compensating states beyond 2011-12 were not tenable. The finance ministry during the previous UPA rule surrendered Rs 8,096 crore in 2011-12, Rs 336 crore in 2012-13 and Rs 7,611 crore in 2013-14, saying no decision could be taken regarding the compensation.
“Locking precious and scarce funds with unrealistic projections and surrendering them with monotonous regularity is not at all acceptable,” said the panel. The panel also recommended that the Rs 10,758 crore allocated for CST compensation to states as part of the revised estimates for 2014-15 as well as the Rs 15,028 crore allocated for 2015-16 should be fully utilised. “This will help the central government in smooth roll-out of GST in April 2016,” it said.
I-T dept identifies 44 lakh income tax return defaulters
The income tax department has identified 44 lakh people who have not filed their return of income and have potential tax liability to be pursued, in the third year of its campaign to widen the tax base. The department told a parliamentary panel that 5.7 lakh people have e-filed returns for tax year 2013-14 in response to the efforts made under its ‘non-filers monitoring system’. In the first year of the campaign, it had pursued 12 lakh people and in the second, 22 lakh, the department said.