TN Finance Minister condemns the 'One Nation, One Tax' policy

Chennai: DMK is opposing GST since the first day it was implemented by the Union Government. Oppositions are slamming the Union government for GST which is affecting Tamilnadu's fiscal autonomy as well as the revenue of the state government. In the recently held GST meeting, Tamilnadu Finance Minister PTR Palanivel Thiagarajan states, "They are always bringing up this 'One Nation, One Tax' slogan. Slogans can be useful to do politics. But implementing it is not practically possible.

Recently Haryana Deputy Chief Minister Dushyant Chautala visited my house. While we were discussing this topic, I questioned him. If 'One Nation, One Tax' is what you want then why are there so many State Assemblies in our Nation? If it is 'One Nation, One Law' means why are there so many Courts? If it is 'One Nation, One Tax' then why are we having separate tax departments for each state? Why are we devising and changing Tax laws constantly?

So, doing propaganda with attractive slogans may help only in politics. It cannot be practically possible. Based on Federalism, the rights of every State must be protected. Only when it is protected India can be 'One Nation'".

Economics Professor Jothi Sivagnanam shared many facts with data to support the statement of the TN Finance Minister. He explained, "As a State, we have to determine our taxable revenues. This is important. But as a state, we lost our rights because of the GST. This is the time to think and debate about it. Initially, the Union Government implemented the tax for Idli, Dosai, and chapati we eat in a hotel. This made a big impact. Tamilnadu has a government which was chosen by the people. This State Government has the right to implement taxes for eateries. The same State government may think about the sufferings of laymen and it might reduce the tax.

But this GST system is totally against all these. The State Government has the right to decide whether to implement tax or not for their own people. Now, we have given up our rights. The loss was heavy due to this GST. The Indian Constitution is giving tax-implementing rights only to the State Government. The Law clearly explains the tax rights of the State as well as the Union Governments. But all the State Governments had given up their rights to this GST.

The State Governments gave up their rights by believing the promise of the Union Government that it will keep the GST Council democratic. They even promised transparency. They assured that only one-third of the tax rights will remain with the Union government and the remaining two third will be in the hands of the State Government. More than all these promises They guaranteed that compensation will be provided for the State governments when they face a loss. No promises had been kept.

The Union government committed that compensation for tax revenue loss will be provided for up to five years. But when there was a profit it was acquired by the Union. When there was a loss, The State Governments were asked to get loans. Even after 5 years GST never attained its stability. The Union government too didn't extend the time period of compensation for the States".

Where is the 14% growth promised by BJP?

The Professor added, "Tamilnadu's tax revenue was higher before the implementation of GST. The Union government promised a 14% growth in tax revenue. But GST only affected the revenue of the States. When the State governments wanted to join hands together against GST, certain BJP ruling states were totally against this. They showed that the welfare of a political party is more important than the rights of the State.

Tamilnadu is producing more revenue for the Union government whereas we are getting nothing from them. They just shared our revenue with Bihar and UP in the name of fewer revenue states. Tamilnadu followed and implemented the family control ratio as per the Union's advice. But States like Bihar and UP never followed. The Union favoured those states which never abided by any rules. They just deceived Tamilnadu.

How is Tamilnadu getting affected?

The Law states that the Union government should share its revenue with the State when it is facing loss. Sharing the revenue is the responsibility of the Finance Committee. And this Committee will meet and decide on the share once every five years. The sharing will be based on the efficiency and equity parameters. Based on this the population of the state will be considered first. In the same way, the Union government should encourage the high tax revenue-yielding states.

Tamilnadu is highly developed and procuring more revenue in the country. So when they consider the share based on the equity alone then it will affect Tamilnadu more. Tamilnadu Finance Minister PTR Palanivel Thiagarajan is pointing out this error. He also said that there wasn't any proper data with the Union on the Tax collection system. This is true. Only when they have data on how much tax revenue they are collecting then can we calculate the revenue we are receiving from the Union government. They do not have any data on this. If they are having, then why are they hesitating to share transparently?

The questions asked by the TN Finance Minister are very fair. They want us to file the tax return every month. For instance, how will a lathe workshop businessman appoint an auditor every month to file tax returns? I am ready to pay the tax. But the procedures have to be simple right? They are asking us to fill out numerous documents. If they are bringing a transformation in the country's tax system, then there should be some growth right? The growth is still below the promised 14%.

The Union government mentioned the term 'National monetisation pipeline'. Usually, the Union can sell certain public property shares to the private. But nowadays they are selling everything to the private. When the Union sells the public property, the land has to be given by the State government only. Then the Union should provide compensation for the State, right? Only the Tamilnadu Finance Minister questioned this. No other state in the Country ever noticed this contradiction".