“We hope that the GST Council meets soon as we would like to review the rules of the GST Council and address certain pending issues,” he told a virtual press conference later, adding if a meeting is held through video-conference, the voting procedure should be intimated in advance.
“I am hoping that the finance minister would respond positively and also with the spirit with which the letter has been written to her,” he said.
Badal said some issues that require urgent discussion in the context of Covid-19 are whether GST be exempted on hand sanitisers, face masks, gloves, PPE kits, temperature-check equipment, oximetres, ventilators and the like.
Badal lamented that the states have given away their rights to the Centre and “we now feel cheated” as the government has changed certain rules without consulting the states.
“They have carried out substantive changes in the rules without consulting states and without taking state legislatures into account, due to which businessmen are being harrassed and intimidated,” he alleged.
“We have voting rights, but the meetings are not happening,” he said.
He alleged that established businessmen are being harrassed under the garb of these rules, which were framed primarily to curb fly-by-night operators.
Senior Congress leader and former Union minister Jairam Ramesh supported Badal’s demand.
“He has raised some very important issues on GST that require urgent action. Hope Madam FM will consider in the spirit with which the GST Council was set up, that hasn’t met for 6 months now,” Ramesh tweeted.
Badal also said the GST is in the formative years and unless corrective measures are taken now, things will go out of hand and the malaise will spread.
“I hope corrective steps are taken and these pending issues resolved at the next meeting to be convened soon,” he said.
On whether Punjab would go in for a lockdown to curb the spread of coronavirus, he said, the state has taken a slightly different route and restrictions are already in place.
“We do not want to prolong the misery of businessmen and the industry,” he said, but added oxygen, life-saving drugs and vaccines are in short supply in the state.
Badal, who is a member of the GST Council, said he is writing on the GST issue when the country is in the middle of battling the new wave of Covid-9 which is more devastating in many ways than the one before.
“I have been particularly persuaded to write this letter because there has been no meeting of the GST Council for the last six months even though council’s own rules drafted in terms of Article 279A of the Constitution provide for holding at least one meeting every quarter,” he said.
Badal said the GST revenues constitute nearly 50 per cent of the tax revenues of states, while this percentage for the Centre is nearly half of that. States have a voting share of 75 per cent in the GST Council.
“However, failure to hold any constructive consultation with states for so long in such critical times makes me wonder whether the Centre has usurped all the power of states putting the spirit of cooperative federalism, that formed the very foundation of achieving consensus on the epic reform, on the back burner,” it said.
He also pointed that the Centre had not appointed a vice chair to the council from among the states.
The Punjab finance minister said a number of provisions have been enacted in recent times through the route of subordinate legislation (rules) bypassing both the GST Council as well as the legislatures.
“It is the basic principle of justice system that substantive rights of a person cannot be taken away except by a due process of law. The recent amendments in GST Rules (like restricting tax credits) have far reaching implications and have been made without even of an iota of discussion in the council,” he said.
Badal also highlighted that harassment of taxpayers has taken an entirely new dimension with officers resorting to threats of arrest, provisional attachment of productive assets and freezing of bank accounts without any established norms.
“I’m informed it is difficult to repair a bad tax system if not done in the formative years,” the Congress leader said.
“The promise of assured compensation does provide a ready catalyst for such a mid-course correction for some more time,” he said.