The Indian Revenue Service (Customs and Central Excise) Officers' Association said that states have no experience of Service Tax which is very different as a concept.

An association representing indirect tax officers has sought Prime Minister Narendra Modi’s intervention to reverse certain decisions taken by the Goods and Services Tax (GST) Council. In a memorandum submitted to the Prime Minister’s Office (PMO), the officers’ body has also highlighted the serious security and financial concerns raised by the Comptroller and Auditor General (CAG) and the Home Ministry against the Goods and Services Tax Network (GSTN). The GSTN is a special purpose vehicle set up to provide information technology infrastructure for the implementation of the new tax regime. The GST Council had in its January 16 meeting agreed to give states the powers to levy tax on economic activity within 12 nautical miles of territorial waters and to administer 90 per cent of the tax payers under Rs 1.5 crore annual turnover, besides drafting certain provisions of Integrated GST.

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The Indian Revenue Service (Customs and Central Excise) Officers’ Association said that states have no experience of Service Tax which is very different as a concept.
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“In such a scenario, divergent views on similar tax issues may emerge across states leading to a plethora of litigations,” it said.

The association demanded revision of the division of assessees below Rs 1.5 crore in the ratio of 50:50. This would mean a vertical split of the entire assessee base in the ratio of 50:50.
It also raised concerns over the GSTN which is manned by non-IRS officers at senior levels.

“There are security and financial concerns in GSTN, which could have been avoided by giving this work to the Directorate General, Systems, Central Board of Excise and Customs. CAG and Home Ministry have already raised concerns regarding GSTN,” the association said.

In written reply to a question in the Lok Sabha, the government had recently said no security clearance was obtained by the Ministry of Finance from the Ministry of Home Affairs at the time of incorporation of GSTN-Special Purpose Vehicle.

The officers’ association has demanded that the Chairman and Chief Executive Officer of GSTN be from IRS, serving or retired or “GSTN kindly be placed under CBEC”.

The association said in many countries GST implementation has failed because of faulty execution in the hand of “generalists”, instead of giving it to “specialists”.

“There is a feeling that the dignity and the vital role of the central government has been compromised and the role of Indirect Tax experts has been undermined in the hand of generalists, which is the major cause of above perceived problems. It may be seen that here is no one to represent this Service in GST Council to give expert advice and technical input. The Chairman, CBEC is only an invitee,” it said.

It said that the Additional Secretary in the GST secretariat is an IAS officer without any experience.

“We will be failing in our constitutional duties, if we do not bring these concerns to your kind notice before the roll-out of GST. Final call is always with the government, to which we promise to abide by.

“We sincerely hope that the issues raised above would be redressed, for the smooth and successful implementation of GST, unlike other countries. Successful GST is our utmost desire,” the association said.