Hyderabad: Taking a cue from Andhra Pradesh’s request for permission to impose a 1% cess on B2B transactions under GST to fund reconstruction and rehabilitation efforts following recent floods, Telangana made a similar request to the GST Council on Saturday.
Deputy chief minister and finance minister Bhatti Vikramarka, attending the GST Council meeting in Rajasthan alongside Union finance minister Nirmala Sitharaman, presented Telangana’s case, highlighting the damages caused by floods in the state. He sought similar approval from the Centre, explaining the state’s need for financial support. The Council is expected to make a decision on this request at a later date.
During the meeting, Bhatti also expressed views on several other agenda items. He proposed the formation of a committee to discuss tax rates on delivery services, emphasizing the need for a legal framework to restore the Integrated Goods and Services Tax to its previous allocation levels. He also recommended that aviation turbine fuel (ATF) remain under the state’ Value Added Tax jurisdiction.
Regarding the tax rate for delivery services, including those provided by e-commerce operators, the deputy CM suggested establishing a committee of officials to thoroughly examine the issue. This proposal was intended to ensure fair tax implementation and was approved by the GST Council.
Additionally, Bhatti recommended the continuation of the Group of Ministers on GST revenue analysis, established in 2019 for state- and sector-wise evaluations. The Council approved this suggestion as well.
On the matter of restoring excess IGST allocations, the state finance minister called for a legal approach to revert the IGST distribution to the levels of the 2015-16 financial year. He proposed implementing this change in the following financial year, and the Council granted approval.
Regarding the inclusion of ATF under the GST framework, Bhatti advised that ATF should remain under the current state VAT jurisdiction due to limited revenue resources available to states. This proposal was also approved by the GST Council.
