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Tuesday, August 16, 2022

DMK mouthpiece says Nirmala needs patience to figure out India’s finances

TN minister calls Nirmala Sitharaman's House speech a lie, says Centre uses GST Council as 'rubber stamp'

Written by Arun Janardhanan | Chennai |
Updated: August 7, 2022 12:57:43 pm
Union Finance Minister Nirmala Sitharaman at Parliament House during ongoing Monsoon Session, in New Delhi. (PTI)

Suggesting that Union Finance Minister Nirmala Sitharaman can seek funds later but it is high time for her to “find a little patience”, ‘Murasoli’, the mouthpiece of ruling DMK in Tamil Nadu, on Saturday asked her to slow down and “figure out the truth about the country’s finances”.

The editorial was published in response to Sitharaman’s speech in Parliament on August 1 on price-rise, increase in GST rates, and taxes on petrol and diesel.

Responding to her remarks on Tamil Nadu and the Opposition’s demand to reduce fuel prices, the editorial asked whether Sitharaman was aware that the state had reduced taxes on fuel in August 2021. Quoting Telangana Chief Minister Chandrasekhar Rao’s statement that “those who increased fuel prices should reduce it,” the editorial stated, “When there are questions aimed at you, answer them instead of throwing blame at others as your answer. Parliament is a place to debate. There will be questions for sure. They should be answered, too. Those who are there are not members of a chorus group to talk alike.”

Taking on Sitharaman’s contention that states are equally responsible for GST rates, state Finance Minister Palanivel Thiagarajan, meanwhile, said “one hundred percent” of the GST Council’s agenda is decided by the Centre, “without consulting the states”.

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He said although GST is seen as a model of federalism, the Centre uses the GST Council as a “rubber stamp”.

Stating that all “major decisions are made by the Union government”, Thiagarajan said, “In the (GST) Council, the system says 75% votes are required for a resolution to pass. But the Union government has 33% votes. That means any resolution brought by anybody (States) is opposed by the Union government, or such resolutions from the state are dead on arrival.”

On Sitharaman’s statement that Tamil Nadu did not reduce taxes when the Centre cut them, Thiagarajan said that her statement in Parliament was “completely false” and “lies,” and pointed out that Tamil Nadu had cut tax on petrol by Rs 3 per litre in August 2021 — “much before the Union government dreamt of cutting it in anticipation of elections in states.”


“The first government cut was in Tamil Nadu after M K Stalin came to power. For somebody to stand up in Parliament and say that we didn’t cut at all would be a lie,” he emphasised.

The editorial in ‘Murasoli’ also criticised Sitharaman’s claim that Tamil Nadu had agreed to a 5% tax on branded food products.

Thiagarajan said, “This rate increase was part of a three-step process. The first, a fitment committee including officials from Tamil Nadu, recommended a series of changes in tax rates. At that time, there was a written and oral submission from Tamil Nadu officials that we were against the hike,” the minister said.


Subsequently, he said, “all those recommendations” were taken up by the Centre’s GST subcommittee for rate rationalisation. “Many discussions were held. Although we were not part of it, we still gave submissions, again opposing it,” he said. “At the end of their discussions, they (Centre) published a summary report with 56 recommendations for rate rationalisation, with some increases (and) some decreases.”

“The next full GST Council meeting was held in Chandigarh. It had 20 agenda items. One of them was the entire 56 items’ rate recommendations report. It was offered to the GST Council to either agree in full or disagree in full on all 56 items, instead of taking each of them. There was no physical time, and it was agreed. She did not [spell out] this fact in Parliament — that it was a three-step process — and made it look like it was a single decision on a single item that was put to vote,” Thiagarajan said.

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First published on: 06-08-2022 at 09:42:12 pm

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