Mukul slams NDA govt for denying ITC in tourism sector

SHILLONG, NOV 21: Meghalaya chief minister Mukul Sangma today accused the BJP-led NDA centre government for targeting big investors by not allowing input tax credit (ITC) in the tourism sector while implementing the new tax regime.

“We need a complete clarity on this why is it like this are they targeting someone who is investing huge amount of money in hospitality sector or not that I want to know,” Sangma told reporters after a cabinet meeting here on Tuesday.

He said that one particular issue which has drawn the attention of the government is in respect of the infrastructures being built like hotels in the tourism sector.

“They (Government of India) have not allowed ITC in the tourism sector whereas the same is allowed for all other infrastructures,” Sangma said while stating under ITC, the tax payable will be less than the tax already been paid.

Stating that it is quite funny that the Centre has a separate parameter for tourism sector, he said, “This is going to discourage people from investing in tourism sector. It is quite a paradox as Centre has lot of schemes to promote tourism.”

Also terming the decision as “abnormal”, the chief minister also is of the view that this will rather defeat the whole rhetoric of the government to promote the nation including Meghalaya as a destination and promote investment in hospitality sector.

“I will be writing to know and have clarity on this abnormal approach while implementing tax regime which is considered to be something which will be simpler and not like a Gabber Singh Tax. It should simple genuine tax not Gabber Singh Tax by targeting some hoteliers,” he said.

Meanwhile, chief minister also informed that the cabinet was also briefed on the revenue scenario and the challenges faced while implementing the Goods and Services Tax (GST) due to incapability of the system being put in place.

He said that subsequent to the rolling out of the new tax regime, the number of tax payers registered under GST is only 9,546 of the 25,852 which were registered under the old tax regime (VAT).

Again, there are new tax payers who have registered which amounts to 5,752 under the GST.

Now all these registered tax payers have to file their returns, he said while expressing concern that because of the incompetence of the system being put in place, they are facing lot of problems.

“Therefore, when all these 9,546 and 5,752 tax payers are required to file their returns only 40 per cent have been able to file tax returns, hence this challenge,” Sangma revealed.

Stating the projected revenue collection is at 14-15%, he said though the state expected much more than this but due the revenue collection could not be assessed because of the incapability of system for ensuring smooth implementation of the GST.

In view of this, he said that the cabinet has directed that this issue be taken up at the GST Council level.

“At the same time whole issue will be taken up at the political level by the chief minister. I will also write to other counterparts,” Sangma added.

By Our Reporter