Chennai: Tamilnadu Finance Minister Palanivel Thiagarajan has said the States’ fears of losing autonomy with the Goods and Services Tax regime have come true.
The direct taxation has been with the Centre and the states had some autonomy on the indirect tax front earlier. With GST, half of this autonomy has gone, he said.
He added: ‘One thing that is very clear to me is the fears of loss of autonomy have been fully realised. The States have now very little independence in any matters of taxation now.’
According to Palanivel Thiagarajan, India is the only country where so much power on taxation rests with the Centre. In countries like the US and China, both direct and indirect taxes are divided at the State, district and county-levels.
‘Given it is the law of the land, our job now is to make it as robust, as dependable, as high utility as possible. Within the constraints of the GST, I see lot of upside in terms of systems improvement, data-driven assessment and decision making, plugging of loopholes, improvement of uniform enforcement,’ he said at a FICCI event.