Bhatti seeks protection of States’ revenues in GST reforms

Deputy Chief Minister and Finance Minister Mallu Bhatti Vikramarka has called on the Centre to protect the revenue interests of Indian States in proposed GST reforms. Addressing the 57th meeting of the GST Council, he warned that Telangana could lose over ₹800 crore annually from changes impacting motor vehicles. Bhatti urged the government to share the full financial implications of proposed changes, particularly those affecting refunds on motor vehicles, capital goods and input services, before implementation.

GST contributes to about 35% of Telangana's own tax revenue, and any decline could directly affect spending on education, healthcare, welfare programs and infrastructure. The Finance Minister stressed the need to balance simplifying compliance for honest taxpayers with zero tolerance towards deliberate tax evasion. He called for stringent action against fake GST registrations, fraudulent invoices and misuse of Aadhaar and PAN details.

Bhatti also highlighted tax evasion in the scrap sector, where its unorganised and cash-based nature enables fake invoicing and fraudulent transfer of input tax credit. To address this issue, Telangana proposed the formation of a Group of Ministers under the GST Council to examine the scrap sector issues and recommend an action plan.

He also requested the Centre to establish regional offices of the GST Network and the GST Council Secretariat in Hyderabad, citing the city's strengths in technology, data analytics and artificial intelligence. Additionally, Bhatti sought a specific and transparent share of funds from Health Security and National Security Cesses for the State to bolster public health infrastructure.