GST will impact govt welfare schemes: Chandrashekhar Rao
Even as the Goods and Services Tax hailed as a positive impact on the country's economy, Telangana Chief Minister K Chandrashekhar Rao has said it will impact government schemes.
Rao is mulling to wage a legal battle against the Centre's GST for taking 'unilateral' decisions.
"The levying of GST on government welfare programmes including drinking water projects, road and irigation schemes will be injustice," Rao said.
"All the ongoing projects were earmarked funds in the state budget and after the implementation of the GST, the project estimates will go up. So, it would be extremely difficult to comply with the norms of the new tax regime,"he added.
"By implementing the GST on the projects started before July 1, the loss will be to the tune of Rs. 19,000 crore. Not only Telangana state but other states will also incur huge losses and it will become a national issue," he said reports DC.
Rao has written to Prime Minister Narendra Modi drawing his attention to the issue.
On Friday, TRS members in the Lok Sabha demanded that the GST should not be imposed on the existing government schemes, saying it "severely impacted" them as the tax burden has been raised from five to 18 per cent.
The GST council has decided to reduce the tax from 18 per cent to 12 per cent for these schemes. But the Centre has decided to levy 12 per cent GST on the ongoing projects.