Member of the Empowered Committee of State Finance Ministers and Bihar Deputy Chief Minister Sushil Modi on Friday said he has written to Amit Mitra, Chairman of the committee, to postpone the upcoming meeting to discuss state revenue resources outside GST and other issues. According to him, the proposed meeting, scheduled to be held on December 14, is supposed to consider the committee’s annual report and statement of accounts. The committee is expected to discuss about state revenue resources and best practices in respect of resources outside the Goods and Services Tax (GST), scope of tax powers of the states and issues related to 15th Finance Commission. “The Empowered Committee has neither been assigned new functions nor a fresh mandate has been given to it. Accordingly, I have requested him to kindly postpone the meeting proposed to be held on December 14,” Sushil Modi told reporters here after an interactive session organised by the Bharat Chamber of Commerce.
He said all the aims and objectives of the committee revolve around implementation of VAT (value added tax) instead of the sales taxes prevailing in the states and charting a roadmap for introduction of GST. With the replacement of VAT or union excise duties or service taxes with GST, the empowered committee has completed the task assigned to it, he said in the letter sent to the committee’s Chairman and West Bengal Finance Minister Amit Mitra. “It is important to note that most of the major indirect taxes are already subsumed in GST, taxes on fuel are moving towards sub-summation in GST and that the methodology of extending GST to fuels can and should be discussed in the GST council,” the BJP leader said in the letter.
In the light of the central government resolution constituting the Empowered Committee and the subsequent announcement in the Budget speech of the then Union Finance Minister, it is clear the “Empowered Committee does not have a mandate” to discuss issues like “state revenue positions and best practices in respect of resources outside GST and the taxing powers of the states or centrally sponsored schemes grants and devolution”, Modi added.