GST Council to discuss Kerala 'disaster cess'

GST Council to discuss Kerala 'disaster cess'

In this file photo taken on August 21, 2018 men carry food and water aid distributed to people stranded by floods in Pandanad in Alappuzha District in the south Indian state of Kerala. AFP

NEW DELHI, DHNS: The GST Council will discuss imposing a "disaster cess" for a limited time to help flood-affected Kerala for its rehabilitation and reconstruction efforts during its September 28 meeting, Kerala Finance Minister Thomas Isaac said on Thursday.

Isaac said the issue came up for discussion when he met Union Finance Minister Arun Jaitley and other senior Ministry officials to raise the demand for allowing a 10% cess on CGST in Kerala so that the state gets some extra revenue.

However, officials told him that imposing a cess on CGST only for Kerala would invite trouble in its implementation. However, Isaac said, Jaitley suggested that they could think about "levying a cess across the country for a limited period on limited commodities".
Kerala had estimated that it want to raise around Rs 2,000 crore in two years through the 10% cess and now is looking at how the Centre could help it with a nationwide cess.

"We wanted a Kerala specific cess. However, the officials suggested it was difficult to make changes in the software. The Finance Minister himself suggested that we could think of an all India cess with a lower quantum. We are positive to it," Isaac told a press conference here after his meeting.

As it involved other states, he said, there is a need for wider consultation and the issue will come before the GST Council on September 28. "The GST Council will have to take a call," he said.

He said Kerala would need around Rs 15-20,000 crore for reconstruction work. Isaac also demanded that the Centre should ease certain rules to allow it to obtain loans from abroad.