IRS officers oppose GSTN, GST council secretariat; seek FM's intervention

An association representing thousands of IRS officers strongly opposed Goods and Services Tax Network (GSTN) on Monday, a private company tasked to create Information Technology infrastructure for GST, and composition of Revenue Secretary-led GST council secretariat.

The association of Indian Revenue Service (Customs and Central Excise) officers have sought Union Finance Minister Arun Jaitley's immediate intervention on these issues. BJP MP Subramanian Swamy has been opposing majority stake for private entities in GSTN and has already written to Prime Minister Narendra Modi objecting to this. The government of India holds 24.5% stake in GSTN while state governments together hold another 24.5%.

The balance 51% equity is with non-government financial institutions, like HDFC Bank, ICICI Bank and LIC Housing Finance. "Management of GSTN be entrusted to Directorate General, Systems of Central Board of Excise and Customs, as GSTN is a newly created Special Purpose Vehicle, which does not have any experience in implementing any IT project or domain knowledge in Indirect Tax laws," the association said in a statement. It said since GSTN is funded by the central and state governments, there is no justification in entrusting its management to private individuals with heavy salary and allowance.

"DG systems has experience of implementing mega pan-India IT projects for over twenty years and has the necessary domain knowledge and expertise to manage GSTN," said the body. The cadre strength of IRS (Customs and Central Excise) is nearly 3,000. Opposing the composition of GST council secretariat, it demanded that the IRS officers be allowed to man it rather than those from Indian Administrative Service (IAS).

The Union Cabinet approved appointment of the Secretary (Revenue) as the ex-officio Secretary to the GST council on Monday and inclusion of the chairperson, CBEC, as a permanent invitee. Revenue Secretary has always been an IAS officer. The Cabinet has also approved creation of one post of Additional Secretary and four posts of Commissioner in the secretariat. The council will decide on the tax rate, exempted goods and the threshold.

The association said that the Secretary to the council be Member (GST) in the CBEC, an IRS officer. The Member GST, being expert in indirect taxation, will not only provide professional inputs to the council to perform in an objective and professional manner, but also he will be able to devote undivided attention for this important responsibility, it said. "This is even more required for smooth and successful transition to GST, as introduction of GST in many countries has encountered rough weathers. The association feels that the Secretary Revenue and Chairman, CBEC could be permanent invitees and guiding force to the GST council," the statement said.

It said that the council which comprises the Union Finance Minister and state Finance Ministers need professional assistance for proper decisions which will ensure success of GST, that will replace most of the central and state indirect taxes. "The association feels that the Secretary Revenue and Chairman, CBEC discharge many responsibilities and are already heading the organisation and therefore they may not be able to devote sufficient time to assist the GST council."

"While welcoming the decision of the Union Cabinet, the association is strongly of the view that the post of Secretary to the GST council should be held by Member (GST), who is of the rank of Special Secretary to the government of India," the statement said.