Finance Minister Suresh Kumar Khanna
State Bureau, Jagran, Lucknow: After the implementation of GST i.e. Goods and Services Tax, there has been a huge decline in the revenue from brick kiln industry along with pan masala and tobacco products in the state. The government is facing a loss of about Rs 1150 crore in revenue every year from these industries.
To compensate for this loss, the Uttar Pradesh government has demanded from the Central Government to make changes in the Goods and Services Tax (GST) system. If the state government is accepted, then GST will be calculated according to the total production capacity of the machines of the industries.
Before the implementation of GST, the annual revenue from Pan Masala industry was Rs 1000 crore, which has now reduced to just Rs 300 crore. The annual income from brick kilns has come down from Rs 700 crore to Rs 250 crore. It is believed that the industries will declare consumption based production to make up for this loss. The state government wants that the system implemented before GST, in which tax was assessed on the total production capacity of industries, should be re-implemented.
Uttar Pradesh Finance Minister Suresh Kumar Khanna had raised this issue of continuous revenue loss since the year 2017-18 with Union Finance Minister Nirmala Sitharaman on Saturday. In which he told the Union Finance Minister that before the implementation of GST, the revenue from Pan Masala and tobacco products was about Rs 1000 crore, after the implementation of GST, now the revenue is only Rs 300 crore. This shortfall in revenue persists even though there is no reduction in consumption.
Before the implementation of GST, the brick kiln industries used to earn Rs 700 crore in revenue, now this revenue has come down to just Rs 250 crore. Khanna says that due to tax determination based on total production capacity, there is no scope for harassment of the manufacturers and the government's revenue also does not decrease. However, Nagendra Shukla, consultant of industries in Kanpur, says that the production based tax system will put additional financial burden on traders.
GST (Goods and Services Tax) is an indirect tax implemented in India from 1 July 2017, which is levied on the supply of goods and services and replaces several old indirect taxes (e.g. VAT, service tax) with a single tax system, with the aim of creating 'one country, one tax', which is levied at every stage of value addition.