Hyderabad: Chief Minister K. Chandrasekhar Rao on Sunday reiterated that he will continue his struggle till the Centre reduces GST on ongoing projects of public importance that are being implemented by the state government.
Mr Rao, who announced on Saturday that he will write a letter to Prime Minister Narendra Modi on Sunday on the GST issue, decided to wait for two more days in order to gather more details on how 12 per cent GST on work contracts would adversely impact the TS government’s Mission Bhagiratha, Mission Kakatiya, irrigation projects, 2BHK housing scheme, power plants etc.
At a meeting on Sunday with senior officials at Pragathi Bhavan to finalise the contents of the letter to be sent to the PM, Mr Rao questioned the justification for imposing 12 per cent GST from July 1, 2017, on ongoing projects that started two years ago.
He said that in the previous VAT regime, there was five per cent tax on work contracts and the state government had made budgetary allocations for all these projects for 2017-18 based on that.
“The TS government has been opposing GST on projects of public importance. Due to our resistance, the Centre on Saturday reduced GST from 18 per cent to 12 per cent. But we are not satisfied with this. We have entered into agreements with contractors for ongoing projects two years ago. It’s not possible to change these agreements to incorporate GST now,” Mr Rao told officials. “We will wait for PM’s response to our letter. If there is no positive response, we have no option but to wage a legal battle,” Mr Rao said.
Officials were told to get more details about the impact of GST. One more meeting will be held on Monday before the letter to the PM is drafted and then sent on Tuesday.
