West Bengal Finance Minister Amit Mitra wrote again on Wednesday to his central counterpart Nirmala Sitharaman, calling for a course correction by the Goods and Services Tax Council (GST) to restore a consensus-based approach in decision making.
Mitra expressed concern that meetings of the GST Council – the only federal body with legislative and fiscal powers – have almost become “toxic”.
He wrote: “What pains me the most is the fact that the GST council meetings have become acrimonious, vexatious and almost toxic with the erosion of the mutual trust that had been maintained between the states. and the Center since the creation of the GST Council. ”
He also cited examples from the past where central government and states accepted each other’s suggestions on important issues such as setting the GST registration threshold.
He said: “I remember many instances where the GoI (the president) gave in to suggestions even with one voice from a state and in turn, the state gave in to the GoI’s proposals despite reservations. The council vehemently debated thousands of pages to formulate the GST law, the IGST law and the GST compensation law without any bitterness of antagonism. I recall that the possibility of a consensus almost collapsed on the distribution of taxpayers between the Center and the States (vertical or horizontal formula) ending with a consensus on a threshold of 1.5 crore, as proposed by the States. But now I fear that reaching such a consensus, even on much simpler matters, has become elusive. “
At the end of his letter, Mitra said: “I urge you, Honorable Minister, to please do some soul-searching on what I have taken the liberty to bring to your attention with the utmost sincerity and frankness, so that you may consider a course correction in terms of operation. of the GST Council.
He wrote: “Frankly, Minister, an undercurrent has emerged in recent times: as the President patiently hears submissions from all States, there is indeed a predetermined conclusion with which the Government of India , assisted by his senior officials, comes to GST Council meetings.