Gujarat has been losing about Rs 4,000-5,000 crore every year, since the roll-out of the Goods and Services Tax (GST) two years ago, state finance minister Nitin Patel said on Monday, on the occasion of second anniversary of roll-out of GST in the country. However, as of now, the shortfall is being compensated by the central government.
Addressing a gathering of representatives of industries and tax practitioners, Patel said that as almost all indirect taxes have been subsumed under GST, it will accelerate the economy. "Single tax across the country will benefit customers and businesses alike," he said.
He remarked that after the roll-out of GST, Gujarat has been incurring a tax loss of Rs 4,000-5,000 crore. However, this loss on the part of Gujarat is indirectly giving a boost to the economy of other states, he said. GST being a destination tax, it is the state where goods or services are sold that receives the tax and not the state from where goods and services have originated. Gujarat being a predominantly manufacturing state, is losing out on revenues, he added.
Total revenue under GST stood at around Rs 44,000 crore, while that of Value Added Tax (VAT) on non-subsumed items stood close to Rs 21,000 crore.
Patel said that while the roll-out of GST is a massive exercise, it naturally resulted in lots of complaints and representations from various quarters. However, the government is receptive to the suggestions from various quarters of society and is trying to solve them. Chief Commissioner of GST, PD Vaghela said that registration of dealers has almost doubled since the GST has been rolled out. This is despite the fact that exemption limits have been raised. The exercise to fill up the vacancies in the tax commissionerate is also underway, as close to 50% of the posts are lying vacant.