Chief Minister Pinarayi Vijayan of Kerala said that an attempt was being made to create the impression that Kerala was heavily dependent on financial assistance from the Centre. Announcing the completion of the reorganisation of the State Goods and Services Tax (GST) department, Mr. Vijayan said the Central share accounted for only 36% of the State’s revenue. The national average was 45%, and in some States, it was as high as 75%, he said.
Dismissing debt-trap allegations
Mr. Vijayan also rejected as propaganda the charge that the State was headed towards a debt trap. The State’s income has been growing at a much faster pace than its debt, he said. The State’s own revenue has increased from ₹63,000 crore 20 years ago to over ₹10 lakh crore today, a nearly 16-fold increase. The per capita income has risen from ₹19,463 two decades ago to around ₹2.3 lakh, a 12-fold jump, he said.
“The people who talk about debt should also have mentioned this growth in income,” he said.
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Reorganisation of taxes department
Kerala has become the first State to overhaul its Taxes department after the introduction of the GST regime, said Mr. Vijayan. The department revamp, which comes with a three-tier system of taxpayer services, audit and enforcement and intelligence, is aimed at offering better services to taxpayers, improving the efficiency of tax collection and curbing evasion, he said.
The reorganisation is relevant in the context of the Centre’s encroachment on the fiscal powers of the States. The Centre is yet to allay GST-related concerns of the States although the tax regime is in its sixth year, said Mr. Vijayan. The powers of the States in the GST Council is limited, the reason why Kerala has been demanding its restructuring, he added.
The poor state of India’s fiscal federalism
Finance Minister K.N. Balagopal, who presided, termed the department revamp “comprehensive” and a step aimed at improving tax collection.
Minister for Transport Antony Raju delivered the keynote address. Mayor Arya Rajendran, district panchayat president D. Suresh Kumar, Central GST Commissioner (Thiruvananthapuram) T. G. Venkatesh, Kerala Vyapari Vyavasayi Ekopana Samithi State general secretary E.S. Biju, Taxes Secretary Rathan U. Kelkar and SGST Commissioner Ajit Patil were among those present.
