GST was a mistake, time to undo the damage: Kerala FM KN Balagopal
The concept of Goods and Services Tax (GST) was antithetical to federalism to begin with, Kerala finance minister KN Balagopal said, adding his voice to a growing chorus of state finance ministers and public-policy experts seeking a comprehensive overhaul of the structure, design and administration of the four-year-old consumption tax. “Cooperative federalism is at stake. GST hasn’t yielded the promised revenue productivity. Let us at least learn from experience and restructure the tax. There are also genuine concerns over the (lack of) democratic functioning of the GST Council. It is up to the Union government to display statesmanship and remedy the damage caused by GST to states’ finances and fiscal powers,” he mentioned .Balagopal said ,The Centre must desist from assuming a great role than envisaged in the Constitution… if the Centre walks the talk on its assurances and goes by the constitutional division of powers between it and the states, then Kerala will confidently grow out of the current crisis and make further progress on the path of sustainable, multifaceted development. Citing the ‘rarest of rare’ economic problems being faced by his state over the past four-five years due to natural calamities including the severe floods of 2018 and pandemics, Balagopal said Kerala, with a creditable track record in “developing human capital”, was being virtually thwarted in its efforts to address ‘second-generation’ issues concerning healthcare, education and employment by assorted national policies and a tilt away from federalism.He added that the Centre needed to really work hard to avoid conflicts in the council. The Kerala finance minister, however, refused to extend allegiance to the demand for a dispute resolution body under the GST Council. “The council is a body of senior political executives. It must be competent to resolve disputes and prevent them from arising.” He said the Centre would do well to adjure the notion that only it possessed good judgement in policy matters and appreciate that states knew better what was best suited for them. It ought to be recognised that states “are equal, equally mature and responsible partners in governance”.