Andhra opposes definition of ‘state’ in IGST

New Delhi: Andhra Pradesh today opposed the definition of ‘State’ in the draft Integrated Goods and Services Tax law, saying it would force states to forgo revenue that is due to them.

“The definition excluded the jurisdiction of territorial waters abutting the coastal states. The state has been levying VAT (Value Added Tax) on the transactions taking place in the territorial waters extending up to 12 nautical miles from the coast since independence,” Andhra Pradesh Finance Minister Yanamala Ramakrishnudu said in a statement.

The minister said the state is realising around Rs 600 crore per annum on the sales of bunker fuels to long-distance vessels and also from gas explored in territorial waters.

“If the jurisdiction of territorial waters is taken away from the states it would result in loss of revenue to all the coastal states,” added Ramakrishnudu.

In fresh roadblocks to GST rollout, states today demanded taxation rights for sales in high seas under the proposed the Integrated Goods and Services Tax (IGST) law.

At the eighth meeting of the all-powerful GST Council, states, including TMC-ruled West Bengal, CPM-led Kerala and Congress-ruled Karnataka, pressed for including area up to 12 nautical miles in the definition of states within IGST, holding up finalising of the draft law for levy of IGST on inter-state trade.

Some states earn as much as Rs 600 crore and Gujarat gets Rs 1,200 crore revenue from taxing sales in high seas.