After a series of negotiations on the implementation of the Goods and Services Tax (GST), the Finance Ministry managed to bring the protesting Indian Revenue Service (IRS) officers on board ahead of the roll-out. The All India IRS Association gave up their protests and is now convinced that their grievances are being taken care of.
All India Revenue Service Association, which has been vehemently protesting against the roll-out mechanism for the new tax regime, has declared truce with the government and is now hopeful of a successful roll-out.
"The Government has assured us to address all our grievances. We believe and trust the good intentions of the Government, which is working in the best interest of people," said Anup K Srivastava, president of All India IRS Officers Association.
SUCCESSFUL IMPLEMENTATION WILL BE WIN-WIN SITUATION
The protesting IRS officers say the successful implementation will be a win-win situation. It will reduce inflation and cascading taxation effect for the consumers. Uniformity in tax will ensure free goods movement and ease of doing business and will ensure competitive export and better revenue realisation for the government. The implementation of GST is most vital for achieving the desired goals.
The association had given several representations to the government regarding their representations. They had maintained the problem was two fold- legal problems arising out of the GST Council decisions and Central Board of Excise and Customs (CBEC) proposals, which need reconsideration by the GST Council.
Article 269A of the Constitution of India gives exclusive powers to the Central government to levy and collect GST on inter-state supplies. And a portion of this GST collected by the Central government has to be apportioned to the recipient state for the goods or services received in that state.
However GST Council had decided that this Constitutional mandate of the Central government will be delegated to the officers of the state governments. The CBEC officials had questioned- which state government's officers will collect this GST on inter-state supplies.
QUESTIONS RAISED BY THE PROTESTING OFFICERS
They asked if one state's officers can lawfully assess the tax which constitutionally belongs to another state. The officials also questioned on will the recipient state's interests be secured by the officers of the originating state. This is important as the basic principle of GST is destination based consumption tax.
The area within 12 nautical miles has been entrusted to the state governments. The protesting officers have also questioned whether officers of the states can lawfully collect any tax in respect of an area which is not part of their state's boundary. Normally an area of 12 nautical miles fall under the jurisdiction of union territories and is controlled by the Centre.
The officers had also said proposals of the Central government, which were in the interest of trade and industry, and would have promoted ease of doing business, were opposed by the states in the GST Council meetings and needed to be revisited before the GST roll-out.
Another grievance of the protestors was that the officers of CBEC have in the past handled a major part of the work for establishing GST (computer) Network. Also, the National Academy of Customs, Excise and Narcotics has imparted GST training to the entire Indirect Tax workforce of the states, along with the workforce of the Central government. But when the GST was set to be implemented, the GST Council had decided to keep the officers of CBEC out of the implementation process for nearly 80 per cent taxpayers.